Consumer confidence slides but businesses more upbeat about economy
( 2001-08-10 13:53) (7)
Consumer confidence in Australia's economy is sliding as prices of goods and services rise, but business confidence is climbing, according to a survey released Friday.
The Bank of South Australia said its June quarter economic study of local consumers and businesses showed 65 percent of the 300 people surveyed felt positive about their household situation, down from 76 percent in the previous quarter.
Some 28 percent believed their situation would improve over the next year, down from 32 percent, the survey showed.
In contrast, 70 percent of the 200 businesses questioned said they feel positive about the current business environment. The survey showed 29 percent of businesses expected to take on extra employees over the next three months, up from 22 percent three months ago.
Bank of South Australia managing director Lou Morris said a growing understanding of a new sales tax, the low-value Australian dollar, high export growth and stable job markets had all helped boost business confidence.
One Australian dollar is currently worth 51 US cents.
``Recent nervousness about the ailing currency and concern about the economy, which dragged down business confidence earlier in the year, has passed and South Australian businesses are feeling more certain about the future,'' Morris said.
Morris said consumers were still coming to terms with the impact of the sales tax on pricing, and higher prices for imports and petrol had also damaged consumer sentiment.
New figures released by the government Friday also showed Australians borrowed more heavily for houses and personal purchases in June while lending to businesses fell 10 percent.
The Australian Bureau of Statistics said lending for home purchases rose 4.4 percent in the month to 7.8 billion Australian dollars (US$ 4 billion), while personal lending climbed 6.5 percent to 4.9 billion Australian dollars (US$ 2.5 billion).
Commercial borrowing was down to 16.3 billion Australian dollars (US$ 8.4 billion), seasonally adjusted, after a 29.9 percent jump in May, the bureau said.
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