Australia’s Business Conditions Improve as Lockdowns Ease

Business conditions in Australia are on the rebound after lifting of lockdown restrictions, supported by a pick-up in activity in the

Australia's Business Conditions Improve as Lockdowns Ease

Business conditions in Australia are on the rebound after lifting of lockdown restrictions, supported by a pick-up in activity in the services sector. NAB’s business conditions index rose to 0 during July from -8 in the previous month, and far better than the lowest level of -34 in April.

Business confidence, however, declined from 0 in June to -14 in July, driven by the high levels of uncertainty and a cautious outlook among firms about the near future. Index of sales surged into positive territory, indicating growth, rising from -6 in June to +1 in July, while profitability rose from -8 to +2.

NAB Group’s chief economist Alan Oster remarks, “Conditions have now recovered to be broadly around their pre-COVID level with improvements across the country. The fall in confidence even prior to the announcement of stage 4 restrictions in Melbourne demonstrates that businesses will remain very cautious given the great uncertainty around the virus at the moment.”

On a worrying note, however, ANZ consumer confidence continued to decline for the seventh straight week, especially as a result of the latest lockdown imposed in the state of Victoria. The main consumer confidence index was down by 2.4% during the previous week while spending on cards fell by 12% in Victoria even as it increased by 17% in the rest of Australia.

ABOUT THE AUTHOR See More
Arslan Butt
Index & Commodity Analyst
Arslan Butt serves as the Lead Commodities and Indices Analyst, bringing a wealth of expertise to the field. With an MBA in Behavioral Finance and active progress towards a Ph.D., Arslan possesses a deep understanding of market dynamics.His professional journey includes a significant role as a senior analyst at a leading brokerage firm, complementing his extensive experience as a market analyst and day trader. Adept in educating others, Arslan has a commendable track record as an instructor and public speaker.His incisive analyses, particularly within the realms of cryptocurrency and forex markets, are showcased across esteemed financial publications such as ForexCrunch, InsideBitcoins, and EconomyWatch, solidifying his reputation in the financial community.

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