Xinhua, Sydney :
Although business conditions for the month of August have reached their highest level in Australia for nine years, consumer confidence has taken a dive, with unenthusiastic buyers the most pessimistic they’ve been in two years.
Business Conditions rose 1 point in August, to hit plus 15 index points, in National Australia Bank’s Monthly Business Conditions and Confidence Survey released on Tuesday.
With “most industries thriving,” the atmosphere for business is the best it’s been since early 2008 in Australia.
In contrast, ANZ-Roy Morgan Consumer Confidence Index showed soft wage growth, higher electricity and energy prices are weighing heavily on consumer sentiment.
Down 3.8 percent this week, ANZ’s head of Australian economics David Plank told Xinhua that “this divergence between business and consumer sentiment is something we have seen all year.”
“It’s just a feature of the global economy,” he said.
Although low wage growth has been a drag on the economy, it has helped strengthen employment growth, according to Plank.
“We expect that over time the employment rate will ease,” he said.
“Because we have to remember that we had the global financial crisis and a collapse in mining investment after the commodity boom, so we’ve had some pretty big shocks to adjust to.”
“It’s not completely unexpected that things have taken a long time to work their way through the economy, but the good thing is that they have done it in a way that has seen Australia continue to grow.”
