Colin Brinsden, AAP Economics Correspondent
(Australian Associated Press)
Business conditions have struck their highest level in at least 20 years with companies seemingly turning a blind eye to Canberra’s citizenship crisis.
The National Australia Bank monthly business survey – which has been running since 1997 – also shows confidence holding above its long-run average, while its employment index continues to imply solid jobs growth.
“(This) should be sufficient to put more downward pressure on the unemployment rate,” NAB chief economist Alan Oster said.
The Turnbull government will be hoping for another positive labour force report on Thursday to at least temporarily shift focus from the citizenship fiasco that has dented its support in opinion polls.
Consumers also appear to be taking the political upheaval in their stride with expectations they will enter the Christmas shopping season in a positive mood.
The weekly ANZ-Roy Morgan consumer confidence index rose two per cent to its highest level in seven weeks.
“The improvement in views towards economic conditions despite the current political uncertainty is quite encouraging,” ANZ head of Australian economics David Plank said.
He expects other data this week will show an uptick in wage growth and along with another positive employment report, should give confidence further support, “even as the political uncertainty rises”.
Independent Tasmanian senator Jacqui Lambie quit parliament on Tuesday after confirming she is a dual citizen.
Six senators and two MPs have so far been caught out over their citizenship status.
The rise in business conditions featured a strengthening in the manufacturing and personal services sectors, as well an improvement in retailing from a weak position.
“The improvement in retail conditions was a welcome result but not enough to dissuade our concerns around the household consumption outlook,” Mr Oster said.
However a separate Australian Retailers Association-Roy Morgan analysis predicts Australians will spend more than $50 million in retail stores during the Christmas trading period from November 15 to December 24.
That would be 2.8 per cent higher than 2016.
The association’s executive director Russell Zimmerman says while the latest retail trade figures have shown a considerable decline, this forecast suggests Christmas sales will be a little bit better, albeit well below the four to five per cent retailers would like to see.
“As online retailing continues to grow, we predict online gift purchases to increase by 3.96 per cent and expect Australian shoppers to purchase most of their gifts online this year,” he said.