Business confidence rises with strong profits, but consumers are getting more pessimistic – Michmutters
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Business

Business confidence rises with strong profits, but consumers are getting more pessimistic

There is a stark difference in mood in the economy.

Businesses are enjoying prosperous conditions with high profits and rising confidence, but consumer sentiment has fallen into deeply negative territory.

In fact, the gap between business confidence and the gloomy consumer sentiment is the largest on record.

Despite that, households are still spending money as though they’re optimistic about the future, and it’s complicating the economic outlook.

But economists say it’s likely that rising inflation and uncertainty will soon begin to weigh on spending, and when that tipping point occurs we may see a real slow-down in economic activity.

Many expect that slowdown to occur next year.

Business confidence rises, despite headwinds

The latest monthly surveys on business and consumer confidence were released on Tuesday.

The NAB monthly business survey showed Australian businesses reported very positive conditions last month.

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