For the second month in a row, business confidence in Australia declined, as the number of businesses searching for workers seems to have declined, as the number of advertisements looking for workers dropped.
The drop in job opportunities is probably the result of the Australian central bank increasing interest rates, which often can cause domestic demand for workers to slow down, which seems the case here. This is also the second straight month advertising for workers in Australia has fallen, seeming to confirm our assertion.
Some economists and bankers said the fall in job opportunities hasn't caught anyone by surprise, as the two quick rate hikes were expected to cause a fall in hiring as a consequence.
A survey of over 400 businesses by the National Australia Bank found the confidence index had plunged by 3 points from March to 13. Companies searching for workers via advertising dropped 1.2 percent in March, including Internet and newspaper advertisements.
Even with the lowered business sentiment and declining new orders, economy of Australia should continue to grow at an annual rate of 4 percent in the first half of the year, although it's unclear if that will be able to continue at that pace in the second half.
Some think the central bank of Australia raised interest rates too quickly, which resulted in the lower business confidence.
As far as metrics for the condition of business in Australia, it declined by 5 points to 8, according to National Australia business conditions gauge, which measures sales, profits and hiring in the country.
The views expressed are the subjective opinion of the article's author and not of FinancialAdvisory.com