Construction PMI tops out

Advertisement

And so it begins. Aussie catch-up growth has been very powerful. But it will end and soon in the second derivative. Indeed, maybe it just did. The AIG construction PMI as new orders growth slowed materially:

Remember that PMIs are directional not positional so some of the components that are in structural oversupply are still well below previous highs in real activity terms, such as commercial and apartments.

Advertisement

For now, they’re getting better more slowly. Soon they’ll be getting outright worse as construction (outside of resi) bogs down into a protracted slump.

The full text of this article is available to MacroBusiness subscribers

$1 for your first month, then:
Cancel at any time through our billing provider, Stripe
About the author
David Llewellyn-Smith is Chief Strategist at the MB Fund and MB Super. David is the founding publisher and editor of MacroBusiness and was the founding publisher and global economy editor of The Diplomat, the Asia Pacific’s leading geo-politics and economics portal. He is also a former gold trader and economic commentator at The Sydney Morning Herald, The Age, the ABC and Business Spectator. He is the co-author of The Great Crash of 2008 with Ross Garnaut and was the editor of the second Garnaut Climate Change Review.