Australia Business Confidence

Australia’s NAB Business Confidence Index rose to 7 in July 2025 from 5 in the prior month, marking its fourth consecutive monthly gain and the highest reading since August 2022, supported by expectations of lower borrowing costs. However, business conditions eased (5 vs 7) but remained solid overall, with slower sales growth (11 vs 14), softer profitability (2 vs 4), and weaker employment (1 vs 4), all of which remain below their respective long-run averages. Meantime, quarterly growth in retail prices accelerated to 1.1% in July, up from 0.5% in June, while producer prices rose at a 0.9% pace. “The survey is consistent with improving economic growth, although still highlights the challenges around cost pressures faced by many businesses,” said NAB Chief Economist Sally Auld. She also noted that the survey overall signals a pickup in activity through Q2, and suggests that global concerns have not significantly impacted local hiring or investment decisions.

Australia’s NAB Business Confidence Index jumped to 5 in June 2025 from 2 in May, improving for the third straight month and marking the highest print since January. It is now in line with the long-run average. Business conditions rebounded strongly (9 vs 0 in May), driven by solid gains in sales (15 vs 5), profitability (4 vs -5), and employment (3 vs 1). Conditions strengthened in most industries, with manufacturing and retail experiencing the biggest upturns after steep declines in May. Forward orders rose (0 vs -2), capital spending jumped (10 vs 6), and capacity utilization was higher (83.3% vs 82.3%). Input cost pressures persisted, with purchase costs up (1.5% vs 1.2%), though still within the mid-2024 range, and labor cost growth eased slightly (1.5% vs 1.7%). Product price growth edged up to 0.6%, but retail price growth eased to a 2-year low of 0.6%. “The survey is encouraging that sluggish momentum in early 2025 will improve into the second half,” said NAB’s Gareth Spence.

Australia’s NAB Business Confidence Index rose to 2 in May 2025 from -1 in April, turning positive for the first time since January and marking its highest level in four months. Sentiment strengthened in most sectors except manufacturing, mining, and wholesale. However, business conditions eased again (0 vs 2 in April), reflecting a steady fall since late 2024. Employment deteriorated (0 vs 4), profitability stayed negative (at -4), and sales slowed (5 vs 6), with retail and manufacturing seeing the largest declines. Forward orders edged up (-2 vs -3), capital spending surged (6 vs 1), and capacity utilization was higher (82.3% vs 81.4%). Purchase cost growth moderated (1.1% vs 1.7%), while labor costs gained slightly (1.7% vs 1.6%). Product price growth fell to 0.5%, with retail price growth steadying at 1.2%. “Business conditions remain weak. If this continues in the coming months, it will be difficult for confidence to rise from current levels,” said NAB Chief Economist Sally Auld.