Andrew Hanlan, analyst at Westpac, points out that the Australia’s NAB business survey showed that the business conditions index rose by 4pts following an 8pts plunge in December (note that the December read was revised up to +3 from +2), while business confidence was little changed, edging up 1pt to a still below average +4.
“The current reading for business conditions, of +7, is broadly in line with average levels (for the monthly series dating back to March 1997).”
“The deterioration in business conditions on a 6 month basis is particularly stark – not as sharp as during the GFC and the introduction of the GST, but otherwise the weakest period in the past 20 years (see chart opposite).”
“The survey suggests that employment conditions currently are consistent with near-term job gains of +19k per month – which is only a little below the 2018 average of +21k and would likely hold the unemployment rate steady. We would note that employment conditions are now almost back to the levels prevailing at the end of 2016.”