According to The Bloomberg today, Australian business confidence jumped and an employment gauge in the survey surged to the highest in almost five years, signalling a healthy job market and reducing the likelihood of an interest-rate cut. The local currency gained.
The sentiment index doubled to six points last month, according to a National Australia Bank Ltd. survey of more than 400 firms conducted March 23-31. The business conditions gauge -- a measure of hiring, sales and profits -- climbed to 12, matching the highest level since before the 2008 global financial crisis. The employment index jumped four points to five, its best result since 2011.
“This is an especially good result in the context of a downbeat global economic outlook,” said Alan Oster, chief economist at NAB. “Low interest rates and a more competitive currency, even given recent strength, are expected to remain key drivers domestically. Consequently, our outlook for the economy remains unchanged -- and with the non-mining recovery expected to progress further, monetary policy is likely to remain on hold for an extended period.”
Australia’s economy is proving resilient in the shadow of recent financial turbulence in China, negative interest rates in Japan and Europe and weaker commodity prices that have combined to increase global risk.
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