The S&P Global Australia Manufacturing PMI rose to 52.9 in August from 51.3 in July, signaling the fastest expansion in nearly three years. Manufacturing output rose at the quickest pace in 40 months, supported by a solid increase in new orders as demand conditions improved and customer bases expanded. Export demand also picked up, with manufacturers reporting new work from the US, Europe, and Asia-Pacific markets. Despite the stronger inflows of orders, employment in the sector declined slightly, as manufacturers shed staff for the first time since February. On the cost front, input prices continued to rise, reflecting higher material, shipping, and wage expenses, though the pace of inflation eased compared to previous months. Goods producers also increased their input purchases and inventories for the first time in four months, reflecting improved confidence. Business sentiment strengthened notably, with manufacturers the most optimistic since April 2022.