Australia’s NAB business survey for April painted an increasingly stagflationary picture, with activity indicators weakening further even as cost pressures accelerated sharply. Business confidence improved slightly from -29 to -24, but remained deeply negative, while business conditions fell from 6 to 3, pointing to a significant slowdown in underlying activity momentum.
The deterioration was broad-based. Trading conditions dropped from 11 to 7, employment conditions slumped from 6 to 1, and profitability remained stuck at 0 as firms struggled to absorb surging costs.
Purchase cost growth accelerated sharply from 2.9% to 4.5% in quarterly terms following the Middle East energy shock, while final product price growth rose from 1.1% to 1.8%. The widening gap suggests businesses are facing increasing pressure on margins as rising input costs outpace their ability to pass prices on to consumers.
NAB said the survey highlighted the growing economic strain created by higher energy prices, warning that rising costs and softer demand are beginning to weigh on activity and investment. Forward orders, capex, cashflow, and employment have all fallen noticeably in recent months and are now sitting well below long-run averages.
| Indicator | Previous | Latest |
|---|---|---|
| NAB Business Confidence | -29 | -24 |
| NAB Business Conditions | 6 | 3 |
| Trading Conditions | 11 | 7 |
| Profitability Conditions | 0 | 0 |
| Employment Conditions | 6 | 1 |
| Purchase Cost Growth (Quarterly) | 2.9% | 4.5% |
| Final Product Price Growth (Quarterly) | 1.1% | 1.8% |
