May Business Conditions Ease Uncertainty
Australian business conditions notched broad-based improvement in the month of May as businesses re-opened and consumer confidence lift. However, commentators warn there’s still a long way to go, with many readings at GFC levels.
According to NAB’s monthly business survey, business confidence recovered to a net balance of -20 points in May, up from -45 points in April.
Business conditions also uplift to -24 points, up from -34 points in April.
Despite improvements, NAB Chief Economist Alan Oster warns business conditions are still “deeply negative – at levels previously seem during the GFC.
Business confidence is also “weak”, with current levels mirroring those during Australia’s 90s recession.
Oster acknowledges the pick up following an easing in coronavirus restrictions “though to varying degrees across the states.”
“However, uncertainty remains high both globally and domestically and businesses likely remain concerned about how quickly they will return to full capacity,” he adds.
The services sector remains the weakest, with domestic uncertainty also following similar trends as global counterparts.