Major bank says business conditions better in Australia
The business environment improved in April, helped by
the Government's cash grants flowing into retail and
transportation sectors. According to the National
Australia Bank's (NAB) monthly business survey and
economic outlook, business conditions leapt seven index
points in April to minus-10 points from minus-17 index
points in March.
"There is little doubt that the results of the April
Survey represent the most encouraging set of numbers for
some time,'' wrote NAB chief economist Alan Oster.
The measure of business conditions is the latest in a
string of positive readings on the economy, including
surprisingly strong retail sales and employment figures
for March and April, respectively.
Forward orders, says the NAB survey, improved for the
second month running to minus-11 index points in April
from minus-18 points in March.
"While Government stimulus packages are no doubt a key
driver of the recent jump in activity reported in retail
and transportation, at least there are now signs that
the falls in demand may be easing," Mr. Oster said.
Released on the eve of the 2009-10 federal budget, NAB
said the latest business survey shows the Australian
economy is in stronger shape than many similar economies
overseas.
Last month, RBA governor Glenn Stevens admitted the
country was in recession by nearly any measure.
However, there have not been two consecutive quarters of
GDP shrinkage, the technical definition of a recession.
Mr. Oster said "… the survey, at the very least,
reinforces the point that the Australian economy
continues to relatively outperform and is not crunching
down as appears to still be the case in many of our
major trading partners.''
The reading on business conditions has been flat or
lower for 11 months, since the onset of the global
financial crisis, which dried up demand and toppled
forecasts for growth.
Confidence rating eased to minus-14 index points in
April from minus-13 in March, according to the NAB
survey.
"While it is perhaps unwise to put too much emphasis on
one month's results, the April survey does seem to point
to a stabilisation of confidence at levels around those
reported in late 2008 and early 2009 - that is, at
levels significantly above the `fear-driven’ readings of
January and February.''
That gauge has been below 50 points, distinguishing
positive from negative results, since January of 2008,
according to data from Bloomberg. Nonetheless,
"Confidence has stabilised at levels significantly up
from the excessively negative reading of early 2009 when
fear of global collapses reigned.''
|
