Australia Business Confidence October 2016

Australia

Australia: Business confidence falls in October

November 8, 2016

The business confidence index published by the National Australia Bank (NAB) fell to 4 points in October, down from 6 points in September. The indicator fell below its long term average of 6 points but remained above the 0-point threshold, which means that Australian businesses are optimistic regarding economic conditions in the coming months.

According to the NAB, this month’s index reading suggests a moderation in economic activity in the non-mining sector. Business conditions fell in October but remained above their long-term trend. The fall in business conditions was due to a pronounced decline in the service industry, while retail conditions improved. On the broader implications for the economy, the NAB commented that, beyond the near-term, impetus from the growth drivers of housing, commodities and retail will fade, “which will see the economy slow into 2018.”

FocusEconomics Consensus Forecast panelists see fixed investment contracting 3.2% in 2016, which is up 0.2 percentage points from last month’s forecast. For 2017, the panel sees investment falling 0.3%, which is up 0.1 percentage points from last month’s estimate.


Author:, Economist

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Australia Business Confidence October 2016

Note: Index of business sentiment; 0-point threshold indicates equal number of positive and negative responses.
Source: National Australia Bank’s Monthly Business Survey.


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