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Australia's political leadership changes, are one of the key causes of the fall in business confidence, according to NAB’s latest monthly survey.
The survey was conducted just after the Australian Liberal Party voted in Scott Morrison as its new leader, and Australian prime minister which eocnomists say could have played a role in the results.
Business conditions however, measured above average and rebounded jumping 2 points to 15. This was due to increases in the profitability and trading indices rising by 6 points.
Confidence is the highest in the mining industry at 20 points, shortly followed by the construction industry at 9 points, while wholesale and manufacturing remain the lowest.
According to NAB’s survey, business investment is an important factor for the economic outlook over next few years, with business investment expected to stabilise and increase. This is due to growth in mining sectors.
The survey shows there’s likely to be further supporting growth and new investment in the mining sector, as well as a higher level of ‘sustaining’ capex post-boom.
Investment in the retail sector is below average, which is likely due to structural changes in the industry, however investments in the sector show more promise.