Profits dip close to a record low
AUSTRALIA'S peak business body has blamed Labor's opposition to the repeal of the carbon pricing scheme for continued decline in business performance.
The Australian Chamber of Commerce and Industry's latest quarterly survey of business conditions found a sharp lift in the expected performance of businesses at the same time that actual business outcomes were deteriorating.
With 50 considered a balance between positive and negative outcomes and expectations, general business conditions were rated just less than 43 in the survey of more than 2000 Australian businesses.
Sales revenue fell, labour market conditions weakened further and expectations around selling prices fell to a record low.
The index of profits fell to a miserable 35.7, the lowest in four years and close to its record low.
ACCI chief economist Burchell Wilson said there was "little evidence" of improvement in the non-mining economy.
"At the moment it is clearly still struggling to fire on all cylinders," Mr Wilson said.
"It is evident from the survey that we are yet to see the recent lift in expectations translating into an improvement in actual trading conditions.
"The improvement in confidence is therefore fragile and vulnerable to correction if these expectations continue to be disappointed."
Mr Wilson said Labor's decision to "oppose the repeal of the carbon tax is a body blow to Australian business and has the potential to jeopardise the recent recovery in sentiment".
He called on the Reserve Bank to consider further interest rate cuts.
"Inflation remains well contained and the recent appreciation of the exchange rate will make it more difficult to achieve the re-balancing in the composition of growth that is desperately needed," he said.
"If non-mining activity fails to pick up as forecast in the months ahead it (the Reserve Bank) will need to re-consider its position in February of next year."