National Australia Bank (NAB) reported in its monthly business survey that business conditions in Australia improved notably in October. Remarkably, the business confidence index climbed to the highest level since mid-2019.
The indicator skyrocketed to 5 points, the strongest mark since May 2019. In September 2020, the index sank to minus 4 points. Besides, the business conditions index showed an uptick to 1 point in October from the zero level in the previous month.
The main reason behind an uplift in investors’ sentiment is that the authorities managed to curb the number of coronavirus cases in the state of Victoria that accounts for almost 25% of the national economy. Besides, experts discovered a slight improvement in the business climate. NAB analysts say that trading conditions and profitability are back on the right track amid a recovery of the domestic economy. At the same time, experts voice concern over a protracted period of lay-offs. So, the employment index still remains on the negative territory with a minus five score in October.
NAB analysts reckon that Australia’s economy is set to increase in Q3 2020 thanks to growing public spending and rate cuts by the central bank.
