Australia Business Confidence May 2020


Australia: Business confidence recovers notably but remains deeply negative in May

June 9, 2020

The business confidence index produced by National Australia Bank (NAB) rose to minus 20.0 points in May, from minus 45.5 points in April. That said, the index remained entrenched deeply below the zero-point threshold, indicating that Australian businesses are mostly pessimistic regarding economic conditions going forward, due to containment measures to limit the spread of Covid-19.

Meanwhile, business conditions improved from April, on the back of less negative profitability, trading conditions and employment prospects. Furthermore, forward orders recovered some lost ground although exports continued to decline.

FocusEconomics Consensus Forecast panelists see fixed investment falling 7.5% in 2020, which is down 1.0 percentage points from last month’s forecast. In 2021, the panel sees fixed investment growing 2.9%.

Author: Massimo Bassetti, Senior Economist

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Australia Business Confidence Chart

Australia Business Confidence May 20 20 0

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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