Ah, the Dun and Bradstreet Survey and its true believer, The Kouk, are ecstatic today, and if it is to be believed, so is Australian business. Expected sales and prices are going boom!
And it’s wall-to-wall:
Except mining, which does not get much representation in the survey, strangely. The Kouk reckons:
“The upswing in the economy continues to unfold, although the only moderate levels for expected employment and capital expenditure suggest a fully-fledged upswing may still be a few months away,” said Stephen Koukoulas, Economic Adviser to Dun & Bradstreet.
“It is encouraging to see a strong lift in firms’ expected sales; a sure sign that GDP growth is on track to accelerate in the first half of 2014. “It appears that inflation pressures are building rapidly, with expected selling prices surging to a five-year high,” Mr Koukoulas added.
“This price outlook from the business sector follows the recent official inflation data which confirmed an uncomfortably sharp rise in inflation over the latter part of 2013. The expectations for higher selling prices suggest even more upside inflation risks into 2014.
“For the RBA, the Business Expectations Survey is good news. The economy is clearly responding to an easy monetary policy and the lower Australian dollar – perhaps too well, and it would be no surprise to see it start hiking interest rates in the months ahead.”
It would surprise me a great deal. It’s good result but until I see employment and capex swing dramatically upwards to offset what this survey does not capture very well – that is, mining – I will fade it. You can’t have big profits and sales without investment and employment. Full survey here.
