Australian Economic Comment Business conditions weaken, confidence still very weak

Research evidence excerpt

Australian Economic Comment Business conditions weaken, confidence still very weak

12 May 2026

Australian Economic Comment Economics

Business conditions weaken, confidence still very weak Australia

◆ Today’s business confidence print for April remained very weak while Paul Bloxham

consumer confidence has remained near record-lows in recent weeks ChiefNew ZealandEconomist,& GlobalAustralia,

Commodities

◆ The NAB survey also showed that business ‘conditions’ fell to an 11-month, HSBC Bank Australia Limited paulbloxham@hsbc.com.au

with the employment and forward orders components weakening sharply +61 2 9255 2635

Jamie Culling

◆ The weakening in these timely indicators suggests that activity may already be Economist, Australia, NZ &

Global Commodities

in a downturn; our central case is that GDP contracts in Q2 HSBC Bank Australia Limited

jamie.culling@hsbc.com.au

+61 2 9006 5042

Facts

- In the NAB survey, monthly business conditions fell to +3pts in April, from +6pts in March. Business

confidence rose to -24pts in April, from -29pts in March. Forward orders fell to -5pts in April, from -1pts in

March. Employment fell to +1 in April, from +6 in March. Capex fell to +4pts in April, from +12pts in March.

Surveyed capacity utilisation fell to 82.5% in April.

- In the ANZ-Roy Morgan consumer confidence weekly survey, consumer confidence fell to 64.1 this week

– its 4th lowest reading in the data since 1972.

- Weekly auction clearance rates have fallen from around 66% in early February to an average of 54%

over the past month (51% in Sydney and 55% in Melbourne).

Implications

As we have noted previously, Australia’s economy is facing two simultaneous shocks, with the RBA

tightening sharply (having now lifted its policy rate three times in as many meetings) and the Middle east