[SYDNEY] Australian firms across most industries saw improving conditions in March, lifting an index to its highest in eight years, a survey showed on Tuesday.
National Australia Bank's monthly survey of more than 400 firms showed its index of business conditions rose four points to +12 last month - its highest since early 2008. Its business confidence index climbed three points to +6.
The capacity utilisation rate, a measure of the underlying health of the economy, climbed to 82.1 percent from 81.5 percent, to be comfortably above long-run averages.
All three components of business conditions - trade, profit and employment - improved. The employment measure jumped to +5 from +1. "The very strong outcome in this month's NAB Business Survey provides strong evidence that the non-mining recovery has not been derailed by the financial market volatility and escalation in global economic concerns earlier in the year," said NAB Chief Economist Alan Oster.
"While the service sector is still a major driver of the recovery, this survey suggests that the improvements may be becoming more broad-based across the economy - particularly in construction and manufacturing." The report underpins NAB's relatively upbeat outlook for the economy and its expectations for monetary policy to remain on hold for an extended period.
At its policy review a week ago, the Reserve Bank of Australia kept its cash rate steady at a record low 2.0 per cent for a 10th straight policy meeting, citing evidence of continued growth at home.