Australia: economy softening
13th August 2002

The results of ACCI's August 2002 National Survey of Business Expectations show an economy that clearly appears to be softening. The economy has continued to grow but there are now some warning signs for the future in terms of investment expectations for the period ahead.

There has been a fall in the Australian Economic Performance indicator from 57.8 in the previous quarter to 52.2 in the most recent. There are negative net balances for General Business Conditions, Exports, Profitability, Employment, Overtime, Investment in Buildings and
Investment in Plant and Equipment.

And while the net balance on sales remains positive, it has fallen sharply back from the +13.4 recorded in the previous quarter to a much more subdued +2.7.

There are clear signs that the international slowdown has penetrated into the Australian economy and that it cannot be taken for granted that economic growth will continue in the same robust fashion over the next twelve months as it did over the past twelve months.

Importantly, as subdued as the current period appears to be, there remains a degree of optimism for the period ahead. General Business Conditions, Sales Revenue and Profitability are expected to improve. But that still leaves employment and investment recording a negative net balance even going forward into the year ahead.

Source: ACCI media release

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