Australian business conditions rise in August

Australian business conditions rebounded in August, according to the National Australia Bank’s (NAB) latest index, following declines in the previous two months.

The NAB’s index of business conditions rose from July’s 12.6 to 15.2 in August as firms reported improved sales and profits, although confidence was knocked as a result of the ousting of former Prime Minister Malcolm Turnbull.

The survey’s measure of profitability climbed 6 points to 16 in August, recovering all of July’s dip, while its sales index increased by 1 point to 19. In addition, the employment index held firm at 10.

“The employment index continues to suggest growth in employment of around 23,000 per month over the next 6 months,” said NAB group chief economist Alan Oster.

“With a stabilisation in the labour force participation rate, this should be enough to see the unemployment rate decline further over the rest of 2018.”

Furthermore, the official August jobs report supported the index data after it was revealed that employment increased by 44,000 over the month and the unemployment rate remained at 5.3%.