Andrew Hanlan, analyst at Westpac, notes that the Australian business confidence index jumped 7pts to +7 and coming off a weak starting position, confidence lifted to be just above average.
Key Quotes
“Confidence likely also received a boost from widespread expectations of an imminent rate cut from the RBA – the first move in rates in three years.”
“Confidence in the ‘finance, business and property’ sector showed a noticeable bounce in the month. In part, this likely reflects a shift in sentiment towards housing – interest rates are now coming down and proposed changes to negative gearing and capital gains tax will not proceed.”
“As to actual business conditions, they weakened in the month, moderating by 2pts to only +1. This is a well below average reading.”
“We caution, the survey results are clouded by the election, given the proximity of the survey period to polling day.”
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