Business output falls to 3-month low in December

The news: Private sector output in Australia fell in December to its lowest level in three months, largely due to slowing manufacturing production, according to S&P Global.

The numbers: The S&P Global Flash Australia PMI Composite Output index dropped to a seasonally adjusted 49.9 points in December, down from 50.2 in November. A reading above 50 indicates an overall increase compared to the previous month, while below 50 indicates an overall decrease.

The context: Services business activity fell marginally to a five-month low, while manufacturing activity was at a two-month low but saw a solid decline. Slower services activity growth failed to offset a sharper downturn in manufacturing production, the report said. Where lower manufacturing output was reported, manufacturers indicated that deteriorating market conditions affected operations in the goods producing sector.

What they said: "Forward-looking indicators meanwhile provided mixed signals. While business confidence climbed to the highest level in over two-and-a-half years, new business growth softened to a marginal pace and the level of unfinished work further fell," Jingyi Pan, economics associate director at S&P Global Market Intelligence said.