Australia NAB business confidence declines in March. | CountingPips Forex & Currency Trading Blog

April 8, 2008 - Forex Economic News

Australia NAB business confidence declines in March.

Australian business confidence fell in March according to a monthly survey released today by the National Australia Bank(NAB). The NAB business confidence index fell by 2 points in March to register -4 on the confidence index which marks the lowest reading since September of 2001. Business confidence had increased in February by 2 points to a -2 index reading after a large fall of 9 points in the January report.

The NAB business conditions index also saw a drop in March as the index fell by 4 points to register a +7 reading. This follows up a decline of 2 points in the February index and marks the lowest reading in business conditions since December of 2002. Survey results showed that business profits fell by 2 points to a +6 index reading, employment dropped 5 points to a +4 reading and trading fell by 4 points to a +13 index reading.

Commenting on the March report, the NAB said, "Undoubtedly, the key message from the March Survey is that, we are now seeing quite a significant broad based slowing in domestic demand and business conditions. Also there is no sign that the rapid deterioration in business confidence has rebounded – albeit another leg down in confidence has to date been avoided."

The Australian GDP is on track to grow at 2.75 percent in 2008 and 2009 according to the report and despite the slowing in growth, tax cuts and a rebound in farm production will help the economy later in the year. Interest rate cuts also may come sooner than expected as economic growth weakens according to the NAB survey. The NAB has moved its forecast of government interest rate cuts from mid 2009 to early 2009 with a chance of seeing rate cuts in late 2008.

The National Australia Bank's monthly survey is based on approximately 350 businesses and tracks the conditions of the non-farm business sector.

Tags: aud, business confidence, conditions, australia, economy, National Bank, NAB

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