Australian business confidence fell for a third straight month in November, weighed down by employment, inventories and export sales measures.
The confidence index dropped to 6 last month from 8 in October, according to a National Australia Bank Ltd. survey of more than 600 companies from Nov. 22-26 and released in Sydney today. The business conditions gauge, a measure of hiring, sales and profits, increased to 4 from a 15-month low of 2.
Reserve Bank of Australia Governor Glenn Stevens and his board left the benchmark rate at 4.75 percent on Dec. 7, citing indicators that show “a more moderate pace” of employment growth in coming months. The RBA will probably hold off raising rates again until May, Alan Oster, chief economist at National Australia, said in a statement.
“Business conditions remain soft and confidence dipped,” and both measures “are below their long-term averages,” Oster said. Profitability “only just” rebounded from declines, employment slid and “mining conditions fell sharply,” he said.
Government data have yet to show a weakening in the job market. Australia’s unemployment rate fell last month to 5.2 percent as employers added 54,600 jobs, the most since January. At the same time, economic growth has slowed, with gross domestic product increasing at a 0.2 percent quarterly pace in July through September, the weakest pace since a contraction at the end of 2008.
Oster lowered his forecast for fourth-quarter GDP growth to 2.7 percent, from 3.2 percent, according to the statement. “The impending mining investment and export boom should provide a spectacular ride -- but the reality is that the train is still yet to leave the platform,” he said.
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