Business Confidence Up 5.7% In June, Led By WA, NSW & QLD
In June the Roy Morgan Business Confidence index continued to recover, rising by 5.7% to 95.0, which puts it at a similar level to March 2020. For the second straight month there has also been a solid increase in businesses that said now is a good time to invest (50.2% of the total), marking the highest figure for this indicator since October 2019.
This growth was led by significant increases in Western Australia (up 8.3%), New South Wales (10.1%), and Queensland (14.6%). The uptick in business confidence has come hand in hand with the fall of COVID-19 cases in these states.
“The notable exception is Victoria, which is now suffering from a renewed outbreak of COVID-19 and for which Business Confidence actually declined by 2.7pts (-3.1%) to 84.4 in June. The outbreak has forced many suburbs of Melbourne back into lockdown throughout July and this may yet be extended to the entire Melbourne metropolitan area if the situation worsens,” said Michele Levine, CEO of Roy Morgan.
This morning the Victorian Premier Daniel Andrews announced that the state’s border with New South Wales will be closed from Wednesday, following Victoria recording its largest single-day increase in COVID-19 cases (127 cases in the past 24 hours).
“For the Australian economy to continue its recovery in the months ahead it is vital Victoria, which by itself represents about 25% of the Australian economy, is able to get on top of the latest outbreak and fully re-integrate itself into a re-opening national economy,” Levine said.
By industry, accommodation and food services noted the most significant recovery in June, up 53.5% as restrictions began to ease. Now, wholesale trade; transport, postal and warehousing; agriculture; information, media and telecommunications; community services; and education and training are all in positive territory.