The S&P Global Flash Australia Composite PMI continued to expand in August 2025, rising to 54.9 from 53.8 in July, marking the strongest growth since April 2022. Both manufacturing output and services activity increased at the fastest rates in 40 months, supported by a solid rise in new orders and expanded customer bases. Services firms boosted staffing levels at the fastest pace since April 2023, while manufacturers marginally reduced headcounts. New export orders grew modestly, with demand coming from the US, Europe, and Asia-Pacific countries. Input costs continued to rise across both sectors, driven by higher material, shipping, and wage costs, though cost inflation eased slightly. Consequently, firms raised output prices at a softer pace, slightly above the long-run average. Business sentiment improved, with manufacturers the most optimistic since April 2022, citing expectations of better market conditions and growth in the year ahead.