Judo Bank Composite PMI

The Judo Bank Flash Australia Composite PMI (Purchasing Managers' Index) measures monthly direction of Australian private-sector output. S&P Global compiles it with sponsor Judo Bank, surveying around 400 manufacturers and 400 service providers. Panels are stratified by detailed sector and company workforce size based on contributions to GDP, and capture only monthly direction, not volumes. It covers manufacturing plus defined services only, not retail, the public sector or the whole economy, and it is not Australian Bureau of Statistics data.

Responses are collected in the second half of each month for a flash release at 09:00 Sydney time in that same half. Each flash release carries composite, services and manufacturing readings together, based on around 85% of responses. Final readings use all responses, and final data are not revised after publication, though seasonal factors may revise the adjusted series. All readings are seasonally adjusted: above 50 means growth since the previous month, below 50 means decrease, and 50.0 means no change.

The composite moves with its two manufacturing and services components and their official annual value-added weights.

• Manufacturing Output Index: captures change in manufacturing production volumes versus the previous month.
• Services Business Activity Index: captures change in services activity volumes versus the previous month, based on a single question about that change.

In the flash release of July 24, 2023, the Composite Output Index fell to 48.3 from 50.1, a modest first contraction in four months. Manufacturing output ticked higher to 50.4 from 48.6, ending a seven-month sequence of contraction. Services activity fell to 48.0 from 50.3 and drove the headline down, since services carry the larger official weight. New orders were broadly unchanged, staffing rose for a 23rd straight month, confidence hit its lowest since April 2020, and cost pressures diverged.

1. Diffusion index: Diffusion = H + 0.5 × U, where H is the percentage higher and U is the percentage unchanged.

For illustration, 30% higher and 45% unchanged gives 30 + 0.5 × 45 = 52.5 on a 0 to 100 scale.

1. Seasonal adjustment: Each diffusion index is then seasonally adjusted.
2. Manufacturing PMI: The headline Manufacturing PMI averages New Orders (30%), Output (25%), Employment (20%), Suppliers' Delivery Times (15%) and Stocks of Purchases (10%).

Suppliers' delivery times are inverted to move with the others.

1. Composite Output Index: The Composite Output Index weights the two comparable output gauges with official annual value-added shares, and no numeric weights are printed.

For illustration only with made-up weights, 52.5 for manufacturing and 45.0 for services at 25% and 75% give 46.9, or contraction despite factory expansion.

1. Flash estimate: Flash values use around 85% of responses, within 80% to 90%, while finals use all responses.