The National Australia Bank (NAB) has reported Monday that business confidence was hit hard by the recent rate hikes and declined by three index points to 13 points in April, thereby adding more pressures on the country's retail, construction and transport industries.

The NAB monthly business survey showed that business conditions also fell by five points to eight index points and jittering a bit the profit and employment conditions even as NAB chief economist Alan Oster is adamant that "the survey is still pointing to an economy easing its way to a good deal of momentum."

It may be that business confidence slid for two successive months, yet Mr Oster stressed that it remained beyond the long term average of seven index points as it appeared that the recent rate hikes are pulling down confidence levels in interest sensitive sectors.

He admitted though that declines in the confidence level of retail, construction and transport sectors are actually happening as pressures on retail prices remained hovering with labour costs keeping its upward trend amidst some challenges on the Australian dollar and a weak retail performance.

All told, NAB said that the Reserve Bank of Australia (RBA) will maintain the current cash rate of 4.50 until August but predicted that more spikes will be ushered between September and December, en route to a year-ending cash rate of up to 5.25 percent.

It must be recalled that the nation has seen a succession of rate movements since October last year and the last two adjustments were announced in April, when the RBA fixed the cash rate to 4.25 percent, and only this May when the rate eventually settled to 4.50 percent.

Mr Oster said that the resurging resource industry, despite the impending impacts of the 40 percent super profits tax, fuelled up the business confidence of the major mining states, stressing that "the strong mining environment currently in effect continues to drive up Western Australia's confidence levels and should push Queensland further to similar levels enjoyed by mainline states."