By According to the latest monthly survey of business by the National Australia Bank, Australian businesses experienced the slowest pace of price growth in October since July 2020. This news is seen as a positive signal that inflation is in retreat.
Inflation Moderating Gradually
Overall price growth was reported to be just 1.0% in quarterly terms, making it the slowest pace since the early months of the Covid-19 pandemic. Labor costs and purchasing costs were also weaker over the three-month period, according to the survey conducted by NAB.
Although inflation is expected to gradually moderate over time, the survey identified that domestic demand levels are more resilient than initially anticipated.
Business Conditions Remain Above Average
In other findings, business conditions rose 1 point to +13 index points in October from September, remaining above the long-run average. Trading conditions also saw an increase of 2 points to +20 index points, while profitability rose 3 points to +12 index points. However, employment eased slightly by 1 point to +8 index points.
Reduced Business Confidence
In contrast to the positive trends seen in business conditions, business confidence fell 3 points to -2 index points in October from September. This decline was observed across most industries.
High Capacity Utilization
Capacity utilization, although slightly lower, remained relatively high at 84%, as reported by NAB.
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