Breaking News
Get Actionable Insights with InvestingPro+: Start 7 Day FREE Trial Register here
Investing Pro 0
Ad-Free Version. Upgrade your Investing.com experience. Save up to 40% More details

Australia Business Gloom Deepens as Delta Updends Economy

Economic IndicatorsAug 09, 2021 09:54PM ET
Saved. See Saved Items.
This article has already been saved in your Saved Items
 
© Reuters. Australia Business Gloom Deepens as Delta Updends Economy

(Bloomberg) -- Australian business sentiment tumbled in July as Sydney’s outbreak of the delta strain of coronavirus forced even tighter stay-at-home orders and leaks of the virus prompted snap lockdowns in other major cities.

Business confidence slumped to minus-8 points from plus-11 in June, National Australia Bank (OTC:NABZY) Ltd. said in a statement Tuesday. The conditions index -- measuring hiring, sales and profits -- dropped to 11 points from a revised 25. The survey ran from July 20-30.

The result showed “optimism collapsing on the back of ongoing restrictions,” said Alan Oster, chief economist at NAB. “The fear is that lower capacity utilization and a fading pipeline on work may see businesses pull back on hiring and investment intentions.”

The highly contagious delta variant has caused shutdowns across Australia’s east coast, the nation’s most populated area, with Sydney now in its seventh week of lockdown. The central bank estimates household spending tends to drop about 15% during lockdowns and expects the economy will likely contract this quarter.

Indeed, a weekly gauge of consumer confidence released by Australia & New Zealand Banking Group (OTC:ANZBY) Ltd. earlier Tuesday fell below the neutral level of 100 for the first time since early November last year.

All three components of NAB’s business conditions fell: trading dropped 20 points, profitability 19 and employment declined 8 points.

“We know that once restrictions are removed that the economy has tended to rebound relatively quickly,” Oster said. “The hope is that the economy again rebounds strongly, and we see little pullback in the very positive investment and hiring intentions we have seen by business in recent months.”

Reserve Bank chief Philip Lowe signaled last week that he’s adopting a similar outlook, pushing ahead with a planned taper of bond purchases in the expectation there will be a rapid recovery. In addition, the governor maintains that fiscal policy is the best tool for aiding households during such episodes -- and federal and state governments have boosted assistance.

Australian authorities are trying to ramp up vaccinations to counter the outbreak after a sluggish roll out left the population vulnerable to delta.

©2021 Bloomberg L.P.

Australia Business Gloom Deepens as Delta Updends Economy
 

Related Articles

Egypt PMI steady in Nov as input costs rise
Egypt PMI steady in Nov as input costs rise By Reuters - Dec 04, 2021 1

CAIRO (Reuters) - Egyptian non-oil activity in the private sector shrank for a 12th month in November as inflation expectations rose, causing new business orders to fall by their...

Add a Comment

Comment Guidelines

We encourage you to use comments to engage with other users, share your perspective and ask questions of authors and each other. However, in order to maintain the high level of discourse we’ve all come to value and expect, please keep the following criteria in mind:  

  •            Enrich the conversation, don’t trash it.

  •           Stay focused and on track. Only post material that’s relevant to the topic being discussed. 

  •           Be respectful. Even negative opinions can be framed positively and diplomatically. Avoid profanity, slander or personal attacks directed at an author or another user. Racism, sexism and other forms of discrimination will not be tolerated.

  • Use standard writing style. Include punctuation and upper and lower cases. Comments that are written in all caps and contain excessive use of symbols will be removed.
  • NOTE: Spam and/or promotional messages and comments containing links will be removed. Phone numbers, email addresses, links to personal or business websites, Skype/Telegram/WhatsApp etc. addresses (including links to groups) will also be removed; self-promotional material or business-related solicitations or PR (ie, contact me for signals/advice etc.), and/or any other comment that contains personal contact specifcs or advertising will be removed as well. In addition, any of the above-mentioned violations may result in suspension of your account.
  • Doxxing. We do not allow any sharing of private or personal contact or other information about any individual or organization. This will result in immediate suspension of the commentor and his or her account.
  • Don’t monopolize the conversation. We appreciate passion and conviction, but we also strongly believe in giving everyone a chance to air their point of view. Therefore, in addition to civil interaction, we expect commenters to offer their opinions succinctly and thoughtfully, but not so repeatedly that others are annoyed or offended. If we receive complaints about individuals who take over a thread or forum, we reserve the right to ban them from the site, without recourse.
  • Only English comments will be allowed.

Perpetrators of spam or abuse will be deleted from the site and prohibited from future registration at Investing.com’s discretion.

Write your thoughts here
 
Are you sure you want to delete this chart?
 
Post
Post also to:
 
Replace the attached chart with a new chart ?
1000
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Thanks for your comment. Please note that all comments are pending until approved by our moderators. It may therefore take some time before it appears on our website.
 
Are you sure you want to delete this chart?
 
Post
 
Replace the attached chart with a new chart ?
1000
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Add Chart to Comment
Confirm Block

Are you sure you want to block %USER_NAME%?

By doing so, you and %USER_NAME% will not be able to see any of each other's Investing.com's posts.

%USER_NAME% was successfully added to your Block List

Since you’ve just unblocked this person, you must wait 48 hours before renewing the block.

Report this comment

I feel that this comment is:

Comment flagged

Thank You!

Your report has been sent to our moderators for review
Disclaimer: Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. All CFDs (stocks, indexes, futures) and Forex prices are not provided by exchanges but rather by market makers, and so prices may not be accurate and may differ from the actual market price, meaning prices are indicative and not appropriate for trading purposes. Therefore Fusion Media doesn`t bear any responsibility for any trading losses you might incur as a result of using this data.

Fusion Media or anyone involved with Fusion Media will not accept any liability for loss or damage as a result of reliance on the information including data, quotes, charts and buy/sell signals contained within this website. Please be fully informed regarding the risks and costs associated with trading the financial markets, it is one of the riskiest investment forms possible.
Continue with Google
or
Sign up with Email