FX.co ★ Australia Business Sentiment Stays Weak

Australia’s NAB Business Confidence Index remained at -6 in July 2026, unchanged from the revised reading in June and still well below its level in February, before the U.S.-Israeli war on Iran began. At the same time, business conditions inched higher (4 vs 3 in June) but stayed below the long-run average of 7. Employment and profitability strengthened, while sales were flat. Capacity utilisation rose sharply to 83.0%, driven by gains in the finance, business and property, and wholesale sectors. NAB noted that, although conditions have improved from the peak impact of the Middle East crisis, “elevated uncertainty has continued to weigh on business confidence.” The bank also highlighted that ongoing cost pressures and a softer outlook for forward demand are likely to keep profit margins under strain. Final prices and purchase costs increased, largely reflecting volatility in fuel prices, with transport and utilities among the main contributors.