Australian dollar lifts on positive NAB business confidence survey
The National Australia Bank’s index of business conditions rose 4 points to +7 in January, jumping sharply from the month before.
The volatile measure of business confidence inched up on point to +4 in January, much softer than recent months.
NAB chief economist Alan Oster said, ‘We had noted that seasonality and statistical volatility may have driven some of the (December) result but that the trend in conditions had been down,’
‘The January survey confirms this, and while we don't think activity in the business sector has crashed, we think that there has been some loss in momentum.’ Mr. Oster said.
The measure of sales rose 3 points to +10, while profitability climbed 4 points to +5.
As expected, the survey shows retail as the worst performing sector, with car sales and personal & household goods coming in the weakest. Mining, recreational and personal and the finance sectors were strongest.
Housing market concerns and a tightening of lending conditions by banks have darkened the outlook for the economy.
It comes after the central bank of Australia last week cut its forecasts for economic growth and inflation after a spate of weak data.
‘We now see the RBA staying in neutral for the foreseeable future, though think the next move could be down rather than up based on the current trajectory of growth and growing downside risks,’ said Mr. Oster.
Australian dollar lifts
AUD/USD briefly popped higher to $0.7075 from $0.7060 off the back of the NAB survey.
This information has been prepared by IG, a trading name of IG Australia Pty Ltd. In addition to the disclaimer below, the material on this page does not contain a record of our trading prices, or an offer of, or solicitation for, a transaction in any financial instrument. IG accepts no responsibility for any use that may be made of these comments and for any consequences that result. No representation or warranty is given as to the accuracy or completeness of this information. Consequently any person acting on it does so entirely at their own risk. Any research provided does not have regard to the specific investment objectives, financial situation and needs of any specific person who may receive it. It has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such is considered to be a marketing communication. Although we are not specifically constrained from dealing ahead of our recommendations we do not seek to take advantage of them before they are provided to our clients.
Live prices on most popular markets
- Forex
- Shares
- Indices
