FXStreet (Bali) – Australia National Australia Bank’s Business Conditions were up to 11 in June from previous 7, while Australia National Australia Bank’s Business Confidence was also up to 10 in June from previous 7.
NAB’s Monthly Business Survey – June 2015
“Firms appear to have shrugged off risks in the global economy as the business environment continued to improve into June. While there were some unexpected variations across industries, business confidence lifted again from +8 to +10 index points in the month – the highest level since September 2013. Confidence is now positive in all industries except mining, which is currently zero.”
“Business conditions improved even more, lifting 5 points to +11 index points in June – the highest level since last October. Improvements in both confidence and conditions over recent months are starting to suggest a more convincing turnaround in the non-mining sectors is underway. Nevertheless, a number of hurdles remain. The more sluggish rise of the employment component is a concern, but the other components (trading and profits) have been strong for a number of months. Conditions still vary greatly across industries as the service sectors continue to outperform. The ‘bellwether’ wholesale industry eased a little and remains at weak levels. Nevertheless, it is encouraging to see leading indicators improve, including forward orders and capacity utilisation.”
“Given ongoing concerns over sluggish non-mining investment, and following a recent RBA bulletin article into the issue, this month we asked firms a new question on the anticipated rate of return they require before committing to a new investment (the hurdle rate). Hurdle rates tend to be slow to adjust, which can impact the potency of RBA rate cuts. Indeed, the average hurdle rate reported by firms was more than 13%, which is extremely high in the current low return environment. Hurdle rates also vary by industry.”
(Market News Provided by FXstreet)