The NAB business survey for Australia showed weaker business conditions but less pronounced weakness in business confidence in December after officials at the Reserve Bank of Australia left policy rates on hold early that month. A separate survey providing more up-to-date consumer confidence data showed consumer sentiment weakened at the start of January.

The NAB survey's business conditions index fell from 9 in November to 7 in December, its lowest level since early 2022. Respondents reported weaker trading conditions and employment, less pronounced weakness in forward orders, and steady profitability. The survey also showed more subdued price pressures, with its measure of quarterly change in labour costs, purchase costs, and retail prices all increasing at a slower pace

The survey's business confidence index rose from minus 8 in November, its lowest level since late 2021, to minus 1 in December. This improvement was broad-based across sectors but the index remains well below its long-term average.

The National Australia Bank (NAB) Business Survey is based on a survey of around 500 firms across the non-farm business sector on their assessment of current business conditions and their sentiment about the outlook. The survey's business conditions index covers trading, profitability, employment, forward orders, stocks, and exports, with respondents also providing responses on changes in costs and selling prices. The survey is conducted in the second half of each month.

The survey of business conditions and confidence offers timely updates on how Australian companies are performing and reacting to unfolding events including news about the overall economy and policy developments. as well as moves in the stock market and changes in interest rates. Investors can use the data to help forecast economic activity and better understand how business conditions and expectations affect sales, employment, investment and other economic outcomes.