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Aussie Business Confidence Solid Despite Headwinds

Businesses are facing headwinds, with rising inflation, and interest rates, not to mention a nation-wide staffing shortage.

Despite all this, NAB’s latest monthly survey shows that corporate confidence and operating conditions remain resilient.

“Most businesses are in a strong position despite the inflation headwinds, with the lift-off in official interest rates and global growth risks yet to significantly impact Australia’s economic trajectory”, the report found.

The NAB survey showed business conditions dropped two points to 16 points, “remaining well above average after a strong first few months of the year”.

Business confidence declined from 10 points to 6 points, which is still above the long-term average.

“Lower confidence in May likely reflects a range of risks on the horizon,” NAB chief economist Alan Oster (above) said.

“Businesses are facing a new environment of higher inflation, rising interest rates, and risks to global growth. However, confidence is still at a fairly robust level, all things considered,” he said, noting inflation “remains a key challenge” for businesses.

“Businesses continue to report elevated price inflation, and while there is little evidence so far of a major response in terms of lower demand, that remains a risk that we will be watching closely over coming months,” he said.



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