Canberra, Australia (4E) – Business confidence in Australia dropped in March to the lowest level since the Federal election in September, while business conditions increased slightly, according to a national business survey released Tuesday.
In February, business confidence declined to +4 in March from +7 in the previous month, while business conditions increased to +1 from zero, according to a monthly business survey of the National Australia Bank (NAB).
NAB group chief economist Alan Oster said Australian business conditions continued to be soft in March and the weak environment is hurting business confidence, which continues to drop. Indicators point to a weak labor market, although better than in the middle of 2013, and too soft to prevent a further slide in the job market.
Tuesday’s report showed that the improvement in Australian business confidence following the election helped the economy as it struggles to adjust to a decline in mining investment after the end of a decade-long resource boom.
Mr. Oster said that this trend may persist over the coming months because of a deteriorating labor market, weak business investment and soft forward orders.
The positive confidence readings for retail, construction, services and wholesale sectors did not offset the negative confidence in the huge mining sector, according to Mr. Oster.