Business

Latest business survey report predicts patchy growth

THE NAB Business Survey report for September suggests solid levels of activity in the non-mining economy, but points to relatively patchy conditions at the industry level.

The major services sectors remain the clear out performers, while more subdued conditions in industries like retail are a disappointing result that warrants close monitoring over coming months. Nevertheless, confidence levels remain somewhat encouraging across most industries, suggesting a degree of resilience to external uncertainties.

Beyond the near-term, however, the outlook is uncertain, particularly as the impetus from resource exports and the housing construction cycle start to fade.

The headwinds, and persistently low inflation, are still expected to prompt the RBA to make two more 25bp cuts to the cash rate in H2 2017, to help firm up growth and stabilise the unemployment rate.

The survey is still consistent with reasonable performance of the non-mining economy, although momentum has eased from earlier in the year.

According to NAB's Chief Economist, Alan Oster there was no hint that the RBA's interest rate cut in early August had any further material impact on confidence in September after seemingly providing some support in August.

"Business confidence is in line with its long-run average and while we would like to see confidence at even higher levels as a precursor to stronger non-mining business investment, this is still a good outcome given numerous uncertainties facing business, especially from offshore."

According to Mr Oster business conditions have been consistently above their long-run average since early 2015, suggesting the recovery through the non-mining economy has become more entrenched.

However, the strength in business conditions has once again become more heavily skewed towards major services industries after some promising signs of a broad-based recovery earlier in the year.

"The re-weakening in employment conditions is disappointing, although employment conditions remain in marginally positive territory consistent with adequate employment growth," Mr Oster said.

Meanwhile, the survey's leading indicators continue to point to solid prospects in the very near-term.

In particular, forward orders jumped notably and have been in positive territory for most of the year. However, NAB's measure of capacity utilisation eased back below the long-run average in September.

"Beyond the near-term, we still expect the economy to slow into 2018. Ongoing low inflation combined with a more subdued growth outlook is expected to jolt the RBA into action, cutting the cash rate by 25bp two more times in H2 2017," Mr Oster said.

Topics:  business confidence nab survey



Naked woman seen wandering main street

Concerns for woman seen wearing only backpack

Farmers turn to 'Airbnb for campers' for their survival

Calvert farmer Dave Colgan is looking at joining Youcamp to boost his income.

"There aren't many who are able to make a go of it just farming"

Why don't they campaign for daylight saving in winter?

IDEAS: Change the clocks altogether, forever.

A new spin on the same old argument

Local Partners

No Plan, Bowie's final music EP, released

NEW: Artwork for David Bowie's posthumous 2016 EP, No Plan.

David Bowie's 28th and final album

Married At First Sight: Ipswich bachelor seeks love

READY FOR IT: Ipswich man Simon McQuillan will appear on the upcoming new season of Married At First Sight.

Romance would top off recovery for Booval man

Dinky-di Denyer: Family Feud favourite hosts Oz Day party

Grant Denyer will host Channel 10's Australia Day concert from the Sydney Opera House.

GRANT Denyer shares his Australia Day traditions ahead of concert.

Chelsea Handler blames the Kardashians for Donald Trump win

Chelsea Handler pictured in a scene from her talk show in Los Angeles.

TALK show host blames rise of reality TV family for election result.

Law & Order’s Trump inspired episode is still in limbo

The cast of Law & Order: SVU season 18, from left, Kelli Giddish, Raul Esparza, Mariska Hargitay, Ice-T and Peter Scanavino. Supplied by Channel 10.

SHOW'S mastermind unsure if or when twice-delayed episode will air.

50 Shades of Bli Bli: Adult theme park plans revealed

THE MIND BOGGLES: Potential buyers of Sunshine Castle at Bli Bli have considered a range of different themes, including an 'adult entertainment venue'.

Sunshine Castle looks to new, prosperous future.

Ipswich block of dirt sells for $582 a square metre

JUST SOLD: A property on the Brookwater golf course sold for a record-breaking $612,000.

Property smashed 2007 record by close to $100,000

Sunday auction for historical home

Former Catholic school sure to attract spirited bidding

Looking back, looking ahead in Noosa

NEVER-ENDING GLORY: Looking towards Laguna Bay and Hastings St from Noosa National Park.

Natural appeal of Noosa continues to attract buyers

NEW: ALDI confirms opening date of seventh Ipswich store

NEW STORE: Aldi will soon open its seventh store in Ipswich.

Aldi is preparing to open its seventh store in Ipswich

Thousands of jobs part of $1b retirement village project

THIS YEAR: An artist impression of the new Aveo retirement village in Springfield.

Aveo Springfield unveiled this month, homes ready by July

Ready to SELL your property?

Post Your Ad Here!