Business spending lowest in three years
Economy-wide business spending saw the slowest monthly growth in almost three years in August, suggesting the boost in business spending in the last Federal budget had worn off.
The Commonwealth Bank Business Sales Indicator (BSI) showed spending grew by 0.2 per cent in trend terms, while annual growth slowed from 7.1 per cent to 6.6 per cent.
However, the annual figure is still above the decade average of 5.1 per cent.
CommSec chief economist and author of the BSI report, Craig James, said the Australian economy was in a strong position despite the drop in sales.
"Interest rates are low, the job market shows signs of settling and home building is underpinning spending across the economy," he said.
"Additionally, Australian businesses have reasons for optimism given a lower Aussie dollar and budget stimulus measures for the small business sector."
In terms of sectors, business services experienced its biggest decline since February, recording a 0.5 per cent fall in August.
However, professional services and membership organisations, and transport grew by 0.7 per cent, while clothing and miscellaneous stores grew by 1.1 per cent in August.
Three states saw annual sales figures fall from the previous year: Northern Territory was down 7.9 per cent, New South Wales was down 5.9 per cent, while Victoria was down 0.2 per cent.
The Australian Capital Territory saw the strongest annual growth (up 12.3 per cent).
AUTHOR
Malavika Santhebennur
Recommended for you
As the industry navigates the fallout from recent product failures, two major AFSLs have detailed their APL selection process and relationship with research houses, warning a selection error could “destroy” a licensee.
The impending retirement of financial advisers in their 50s could see the profession face significant succession challenges over the coming decade and younger advisers may not be the answer.
With a third of AFSLs being solo advisers, how can they navigate key person risk and ensure they are still attractive propositions for buyers when it comes to their succession planning?
A quarter of advisers who commenced on the FAR within the last two years have already switched licensees or practices, adding validity to practice owners’ professional year (PY) concerns.
