While business confidence remains 17.2 points below its October peak last year, Roy Morgan said confidence is now above the average of the past four years.
The figures for July were the result of 950 interviews with all types of businesses across Australia.
Roy Morgan director of industry communications Norman Morris said both business and consumers are “obviously overcoming the shock of the Budget and showing increased optimism in the short to medium term in the outlook for the Australian economy”.
“The full impact of the Budget is yet to be seen with problems getting it passed by the Senate,” said Mr Morris.
“This may be resulting in a short-term improvement in confidence but continuing instability and uncertainty is not a good environment to make business decisions.”
Mr Morris said while the areas of retail, construction and manufacturing showed some improvement in July, these sectors all remain below average in confidence.
“In the meantime, the improved level of confidence in the economy picking up over the next five years is likely to increase the appetite for business expansion and borrowing, which is good for economic growth and recovery,” he said.
Mr Morris said with businesses becoming more inclined to borrow, banks will need to improve their customer dealings with businesses given this service is currently at unsatisfactory levels according to research by Roy Morgan.
“It is obvious from this that banks and business will need to work more closely with each other if they are to achieve a positive outcome for all parties and the economy,” he said.
