The Australian economy remained weak during January as business conditions lost momentum, a report from NAB has said.
In its monthly business survey, the bank said business conditions had recorded a below average performance in the period to January.
“Conditions have fallen for three consecutive months, with the index dropping another half a point in January (unchanged when rounded) to +2 index points – below the long-run monthly survey average,” the report said.
NAB pointed to falling sales, easing profits and a soft employment sector as key trends over the month but noted that results varied across industry sectors.
“By industry, manufacturing deteriorated considerably, while most other industries were flat to lower – mining and wholesale were exceptions,” it said.
“Against that orders were up (albeit still soft), while non-mining capex is still reasonable.”
Meanwhile, confidence edged up over the month, defying the gloomy outlook for certain economic sectors, but remained below long-run averages, NAB found.
“The trend in confidence is clearly down and sits at relatively soft levels,” it said.
“Confidence remains close to its lowest level since the pre-election jump in mid-2013.”
Levels of confidence by industry were mixed, with the mining sector remaining weak but retail recording a “surprising improvement”, the report said.
Overall, NAB suggested the economy remains on shaky ground.
“The fundamental story painted by the January Business Survey is still one of a soft economy, with little momentum, weakish confidence and considerable difference across sectors,” it said.