Australian businesses are growing more confident by the day according to NAB’s latest Monthly Business Survey & Economic Outlook, as business confidence hit a six-year high in August.
Business confidence jumped eight points in August to reach an overall reading of +18 points – a level not previously seen since October 2003. While the improvement was broad based, noticeable gains were recorded in the retail, finance, manufacturing and recreational and personal services industries.
The survey also recorded an improvement in business conditions of three points, to reach an overall reading of +4 index points, reflecting strong increases in trading and profitability, NAB said.
NAB chief economist Alan Oster said the survey readings suggest that it is “more likely than not that the Australian economy edged higher in the third quarter (we had previously expected a quicker fallback in activity as the consumer-related stimulus was withdrawn).”
Based on the results, NAB has increased their GDP forecasts for Australia by 0.5 percent and expects the RBA to raise interest rates in November by 25 basis points to 3.25 percent.
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