National Australia Bank business confidence and conditions for June

National Australia Bank business confidence for June, 10

  • prior was 8, revised from 7

National Australia Bank business conditions for June, 11

  • prior was 6, revised from 7

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Business confidence at highest since September 2013

Comments from NAB (bolding mine):

  • Improvements in both confidence and conditions over recent months are starting to suggest a more convincing turnaround in the non-mining sectors is underway
  • Nevertheless, a number of hurdles remain. The more sluggish rise of the employment component is a concern, but the other components (trading and profits) have been strong for a number of months. Conditions still vary greatly across industries as the service sectors continue to outperform. The 'bellwether' wholesale industry eased a little and remains at weak levels.
  • Nevertheless, it is encouraging to see leading indicators improve, including forward orders and capacity utilisation

More:

  • There also appears to have been little reaction to concerns over the Chinese equity market bubble (and its partial unwinding) and ongoing issues with Greece - although the Survey was conducted prior to the escalation of Greek concerns following the recent referendum
  • Positive confidence was relatively broad based across industries, which could suggest greater sustainability, although growing jitters on global matters (especially in regards to China) suggests that current levels may be hard to sustain

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Comments from Alan Oster, NAB chief economist:

  • A post-budget kick in confidence appears to have driven better business outcomes
  • Against that consumers remain cautious and business remains reluctant to hire. It is difficult to assess the impact of recent international events such as Greece and more importantly China
  • The economy is becoming increasingly reliant on an upturn in non-mining investment to drive growth and productivity
  • While there has been a marginal response in non-mining investment to lower interest rates, spending intentions in the non-mining sector have taken a step backwards in the first half of 2015