prawdziwystarywjarus
10.02.09, 12:05
business.smh.com.au/business/business-confidence-slumps-to-record-low-20090210-82vv.html
Business confidence reversed December's gains and tumbled to a record low in
January with the outlook for employment and forward orders hitting
recessionary levels.
Companies' confidence dropped to minus-32 index points last month, a new low
for the 12-year history of the National Australia Bank's survey. That compared
with December's improvement to minus-20, following November's minus-30 reading.
The index has now been in negative territory since January last year,
indicating pessimists outnumber optimists in the survey.
''It needs to be noted that the survey was largely completed on the Monday
prior to the announcement of the Government's new fiscal package and the RBA's
rate cut,'' said NAB group chief economist Alan Oster in a statement. ''As
such confidence may have improved a touch since then.''
The Government announced a fresh $42 billion stimulus plan last week on the
same day the Reserve Bank lopped another percentage point from the interest
rate, bringing it to a 45-year low of 3.25%, in an effort to keep the local
economy expanding in the face of a global slowdown.
Money markets are predicting the RBA will continue to cut rates, pricing in
another half-percentage point cut in March to 2.75%, according to Credit Suisse.
According to a separate report, about one in four firms expects to cut staff
in the June quarter as the slowdown bites, according the Dun & Bradstreet
business expectations survey also released this morning.
Recession levels
''The fact remains, however, that even on last month's reading confidence was
already at levels at or below the bottom of the early 1990s recession,'' Mr
Oster said.
Despite the drop in business confidence, NAB is sticking with its forecast
that the economy will endure only a mild recession before returning to growth
next year. The bank is predicting GDP will shrink 0.25% in 2009 and growth 1%
next year.
According to the NAB survey, employment remains as weak as it had been during
the recession of early 1992 at minus-17 index points.
The Australian Bureau of Statistic will release official January unemployment
data on Thursday, with economists expecting the jobless rate to hit 4.7% from
its current 4.5% with 18,000 positions lost for the month.
Forward orders edged up four points, the survey said, ''but, at minus-20 index
points, is still at levels not seen since December 1991.''
As the demand for commodities exports drops, capital spending continues to
fall, hitting minus-21 in January. Mining and resource companies are paring
back production as orders shrivel at home and abroad.
Conditions grim
Business conditions also slumped in January, hitting minus-11 index points,
from minus-6 in December, the NAB survey said, undoing half of the boost seen
in December, as the October stimulus effect worked its way through the economy.
''In broad terms around half the kick up in business conditions in December
were lost in January - with the same areas affected,'' the report said.
Trading conditions contracted minus-7 in January after increasing by 17 points
in December, according to the report.
''Also it is worth noting sectors that did not appear to benefit much from the
December package - manufacturing, construction transport and mining fell
further in January,'' the report said.
Exports drop
''While much of the downturn to date has driven out of the domestic economy,
the survey is increasingly showing signs of the impact of global forces,'' the
report said.
''Thus while we have not been collecting data on export sales - only since
February 2001... the trends that have emerged in recent months are quite stark
and concerning.''
Exports dropped 8 index points to minus-33 points in January, a swoon of 23
points in the last two months alone, the report says.
The Reserve Bank and bank economists have grown increasingly focused on the
effect China's economic slump will have on the local economy. Since July,
commodities prices have crumbled, reflecting lower growth expectations for the
global economy.
The price of commodities has retreated from a record high reading on the
Reuters Jefferies index of 473.5 index points at the beginning of July to the
low 200s, in recent months.
The broad reading of the commodities index, closed at 223.9 index points
yesterday, down more then 50% from July.
