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NAB Business Confidence fell in November

Tuesday, Dec 09 2014

 

Latest NAB Business Confidence survey showed decline from previous month revised level of 5 to 1. This followed no change in October.  Orders held up reasonably well, which reflects well on near-term demand. The fall in conditions was driven by all three components (sales, profits and employment), although the last remains the weakest, pointing to only very modest growth in employment –insufficient to prevent a further rise in the unemployment rate. But while last months spike was relatively broad based, the pull back in November was much more mixed across industries –concentrated in retail, manufacturing and service industries. 

 

NAB chief economist Alan Oster  said that "in light of the weaker growth and employment outlook NAB has changed their RBA cash rate forecast. The modest rate increases that we previously saw from late 2015 are now unlikely to occur and we have pushed these into late 2016.   Moreover, the chances of the RBA needing to lower the cash rate in the near term have risen materially over the past month .” He concluded that a likely scenario was that rates would need to be cut as a way of lowering the Australian dollar.

 

After the data was released, Aussie head lower and is currently being traded around 0.8250 area, which should offer some amount of support. Later today, in the US session JOLTS Job Openings figures will be released.

Last modified on Tuesday, 09 December 2014
More in this category: « UK Industrial Production down by 0.1% Aussie lower on China Trade Balance figures »

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