Australia currently has an almost unprecedented divergence between business reporting booming conditions vs relatively gloomy consumers (Figure 1). Firstly, on the business side, a range of business surveys suggest conditions are around a cycle (or record) high. The key NAB business survey reported a further pick-up of business conditions in July to +15, which is the highest level since the GFC intensified in early-2008. Business confidence also bounced to +12, which is around the highest level since 2010 (Figure 2). This pick-up of business conditions has also now become more broad-based across the States, with even WA bouncing to ‘break-even’ in Q2-17 (Figure 3). Indeed, across industries, the 3-month average of all 8 industries is in positive territory, with most trending above their own average (Figure 4).
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David Llewellyn-Smith is Chief Strategist at the MB Fund and MB Super. David is the founding publisher and editor of MacroBusiness and was the founding publisher and global economy editor of The Diplomat, the Asia Pacific’s leading geo-politics and economics portal.
He is also a former gold trader and economic commentator at The Sydney Morning Herald, The Age, the ABC and Business Spectator. He is the co-author of The Great Crash of 2008 with Ross Garnaut and was the editor of the second Garnaut Climate Change Review.
