Australia – NAB business confidence, December 2020: 4 (prior 13) and conditions 14 (prior 7)

A lacklustre ‘confidence’ result, but do note the ‘conditions’ index tends to be more objective. 

Main points/remarks via NAB:

Business conditions rose further in December to its highest level since late 2018

  • fourth consecutive month of improvement
  • employment conditions are back in positive territory for the first time since the start of the pandemic
  • conditions are now well above average

Business confidence 

  • confidence pulled back in NSW, Victoria and Queensland
  • In part, this likely reflects the impact of the Sydney COVID-19 outbreak through December

leading indicators suggest the pipeline of work continues to build – pointing to an ongoing recovery in the months ahead

  • capacity utilisation saw further gains and is now around its long-run average (and pre-virus levels)
  • forward orders pulled back but remain in positive territory

Most indicators within the survey are now broadly at or above pre-virus levels, with the exceptions being export conditions – no surprise given the pandemic continues to disrupt global trade -and capital expenditure. 

By sub-component

  • employment index rising 13pts to 9
  • Trading (up 5pts) 
  • profitability (down 2pts)
  • All three sub-indices are above average, for the first time since early 2019. 
nab Australia business confidence

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