Business confidence up 8.3% in January: Roy Morgan Research
Roy Morgan’s latest business confidence survey showed Australian businesses are entering 2015 with a more optimistic outlook than previous years and are considering the next twelve months as a good time to invest in growing their business.
The survey of 1,056 businesses was conducted before the Reserve Bank of Australia dropped the official cash rate on Tuesday from 2.5% to 2.25%, an indication that business confidence over January was moving in a positive direction.
Roy Morgan Research communications director Norman Morris said the improvement in business confidence in January was likely to be due to a number of factors, including less public discussion of the budget deficit problems, more publicity regarding the likelihood of an interest rate cut, lower fuel prices, lower Australian dollar and a decline in wages growth.
“The reduction in the official interest rate just announced by the RBA is likely to improve business confidence even further over coming months."
While the 8.3% jump in business confidence in January was across all areas, improvement in the economic outlook for the Australian economy over the next five years was a clear factor, with more businesses looking to invest in growth.
In particular, 'finance and insurance' and 'professional, scientific and technical services' are seeing positive gains in business confidence, but Morris warned that banks will need to do more to increase the satisfaction levels of business confidence, as the December business customer satisfaction level was weak at only 68.1% compared to personal customers with 82.6%.