NAB Survey Underlines Positive Business Conditions in November
Mining has again fueled positive movements in the Australian economy as the latest survey commissioned by National Australia Bank (NAB) indicated that business conditions in November jumped sufficiently enough for specks of growth to take effect.
The positive outlook has been achieved despite the unsettling situation dominating the global economies, specifically the financial and debt crises gripping many countries in Europe, the NAB survey said.
"Given that we have seen some slowing in global activity data, especially in Europe, the up-tick in conditions in the month is perhaps more favourable than might have been expected," NAB reported.
Apart from the resources industry, the new report pointed to contributions seen in the service and retail sectors, which NAB said were mostly spurred by seasonal upticks directly connected to the rush of economic activities attached to the holiday season.
"However, business conditions were by no means equal across sectors. The pick-up in business conditions in the month reflected improvements in employment conditions and profitability," the NAB report said.
Nonetheless, the pick-ups have been observed in most sectors, the report said, as key indicators like labour costs purchase costs and final product prices all recorded positive numbers that carry one meaning - growth is in progress.
The one letdown though is Australia's trading conditions, which according to the monthly assessment has declined slightly in the month but not enough to dampen a growth forecast that could reach 2.1 percent by the yearend.
That outlook has been projected to expand by up to 4.0 percent in the initial months of 2012, with NAB underscoring that "our GDP forecasts have been strengthened to reflect stronger consumption and mining investment growth."
Such encouraging prospects came with an increase of 5.2 percent in total personal finance commitments in the month of October, which grew to $7.317 billion, basing on the data provided by the Australian Bureau of Statistics (ABS), coming from the $6.596 billion seen in the previous month.
HSBC chief economist Paul Bloxham read the indicators as glaring testament that the domestic economy is in good shape with some surprises, most notably the employment figures that returned higher than what economists have been expecting.
"The conditions and the confidence numbers look as though they're broadly stable in the month ... and there are a few signs here that things are about to decline, but the conditions in the economy look like they're tracking well, albeit modestly," Bloxham told The Canberra Times.
"One thing that's interesting is that the employment part has ticked up again which runs counter to some of the anecdotes out there," the HSBC analyst added.