Business conditions “robust”
NAB has recorded a 3 point jump in its Monthly Business Survey to +21 index points for February, the highest level since the survey began in March 1997.
On a trend basis, the survey recorded strongest conditions in construction, mining, finance, and property and business services. Mining and construction were also the most confident industries.
NAB Group Chief Economist Alan Oster said the results indicated that business activity in Australia was robust across the board.
“The survey results for February reinforce our views on the outlook for the Australian economy,” he said.
“After last week’s release of below expectation GDP growth data, the strength in business conditions and leading indicators makes us more confident that Australia will see stronger economic growth in coming quarters on the back of LNG exports, and business and Government investment.”
This would sustain jobs growth, reduce unemployment, and put gradual upwards pressure on private sector wages, Mr Oster said.
“We expect by late 2018 the RBA will feel relaxed enough about the domestic fundamentals to cautiously start withdrawing the stimulatory policy stance it is currently running,” he said.
“However, it will depend heavily on the data flow and the risk is that the RBA will delay rate rises until early 2019.”