Australia Business Sentiment Rises to Near 3-Year High

Australia’s NAB Business Confidence Index rose to 7 in July 2025 from 5 in the prior month, marking its fourth consecutive monthly gain and the highest reading since August 2022, supported by expectations of lower borrowing costs. However, business conditions eased (5 vs 7) but remained solid overall, with slower sales growth (11 vs 14), softer profitability (2 vs 4), and weaker employment (1 vs 4), all of which remain below their respective long-run averages. Meantime, quarterly growth in retail prices accelerated to 1.1% in July, up from 0.5% in June, while producer prices rose at a 0.9% pace. “The survey is consistent with improving economic growth, although still highlights the challenges around cost pressures faced by many businesses,” said NAB Chief Economist Sally Auld. She also noted that the survey overall signals a pickup in activity through Q2, and suggests that global concerns have not significantly impacted local hiring or investment decisions.