The firm’s latest business confidence report interviewed 2,681 business decision makers across Australia and found a broad increase in business confidence in July.
“Business confidence in Australia has improved for the first time in five months due to a number of positive factors impacting on business in Australia,” Roy Morgan communications director Norman Morris stated.
“These include an increase of 5.2 per cent in the ASX 200 over the month, the end of the government wrangling with the electing of Kevin Rudd as PM, and the abolition of the carbon tax,” he said.
The continual decline in the value of the Australian dollar is also helping some sectors of the economy, but there is still concern over the global economy and the Chinese slowdown, he added.
There has also been a boost in investment intentions, with 55 per cent now considering the next 12 months to be a good time “to invest in growing the business” - up from 52 per cent in June.
‘Finance and insurance’ was the most positive sector, followed by ‘education and training’ and ‘information media and telecommunications’.
However, confidence level in the ‘manufacturing’ sector remained well below average, with only slight improvement.
The results echoed the findings of the Roy Morgan consumer confidence survey.
“The improvement in consumer confidence in July was also as a result of largely the same influences that impacted business outlook,” Mr Morris said.
Roy Morgan stated a positive economic outlook is likely to be helped by the recent Reserve Bank’s monetary easing.
“Consumers are feeling far more positive ... about conditions being better in the next 12 months and this is driving up their confidence,” Mr Morris said.
“The decline in the official cash rate in early August is likely to have a positive impact on both business and consumer confidence in August.”
