The rate of decline seems to be slowing, but one should be cautious about January surveys. Traditionally, Ozzies take their summer holidays between Christmas and Australia Day (26th January). Seasonal adjustment is supposed to remove this effect, but the seasonality is so large, it leaves (conceptually) a potentially larger than normal "error term", which can be in either direction. Many small businesses are completely closed from the 23rd December to the 8th/10th of January. Also, this is the "flash" estimate, which means, given the large seasonal dip, that the final estimate could be revised by more than usual. The rise in the iron ore price might indicate an imminent lower turning point for the Ozzie business cycle. On the other hand, the coal price is looking soggy. These are Australia's two largest exports.
The chart below shows the Oz manufacturing PMI compared with the Big 8 PMI. We won't have January data for the Big 8 until 1st February.
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