Australia Business Conditions Improve; Confidence Falls

(RTTNews) - Australia's business conditions improved in August but confidence weakened after four consecutive increases, survey results from NAB showed Tuesday.

The business conditions gained two points to 7 in August and remained around its long-run average.

The improvement in August reflected gains in employment and profitability, while trading conditions stayed unchanged compared to the prior month.

The profitability index doubled to 4 from 2 and the employment indicator climbed to 5 from 2. The index for trading held steady at 12 in August.

Meanwhile, the business confidence indicator fell to 4 from 8 in July. This followed four consecutive months of improving sentiment and left sentiment close to long run average levels, the survey showed.

Forward orders strengthened by two points to 1 in August, continuing the upward trend evident over the past year. Moreover, the series turned positive for the first time in two years.

Capacity utilization lifted in August and reflected continued tightness in the supply and demand balance. The rate rose to 83.1 percent from 82.5 percent a month ago.

However, measures of costs and prices moderated slightly in August. Purchase costs grew 1.1 percent, which was its slowest since 2021.

Labor costs growth eased to 1.5 percent and product price growth broadly slowed to 0.6 percent and retail prices growth halved to 0.5 percent.

Overall, the survey suggested that the business outlook became more positive in recent months, consistent with a better tone to official economic data of late.