If only confidence was a tangible commodity, like coal or iPhones or barramundi. Because Australian businesses appear to be investing heavily in it.
Confidence about sales, profits and capital investment are heady and strong for the final quarter of 2010, according to Dun & Bradstreet’s latest National Business Expectations Survey. Five of the survey’s six key indicators show signs of improvement, D&B says. To wit:
- Sales expectations surged by 15 points, widening the survey index to 33.
- The profits index, at 22, was at the highest level in six years.
- Capital investment expectations reached their highest point in seven years, rising five points to 18.
- Selling price expectations gained three points to reach an index of 20.
- The inventories index rose five points to 12, its highest point in more than six years.
Why all the upbeatness? D&B said capital investment for the second quarter was in the black for the fifth straight quarter. Thirty percent of surveyed firms increased their sales compared the same quarter in 2009, while 24 percent had lower sales. Fourteen percent of businesses grew their staff while nine percent reined things in.
We can’t say what this equates to in barramundi tonnage but the news apparently indicates a sunnier outlook. Here are the issues D&B says should influence businesses in the final quarter:
- Thirty-one percent of executives rank interest rates as the primary influence on their business.
- Twenty-nine percent expect wage growth will be the No. 1 influence.
- Fifteen percent pointed to access to credit.
- Fourteen percent cited fuel prices.
“The turnaround in the expectations of Australia’s executives since the previous quarter has been quite remarkable,” said Christine Christian, Dun & Bradsteet CEO. “The one area were firms remain cautious is employment. However, the intended level of hiring activity for the December quarter is still positive.”
Image by dotbenjamin