Welcome
Following the unveiling of the Federal Budget, NAB's leading economists have unpacked what it means for you and your business.
From a big picture stance, the Budget is designed to tighten fiscal policy to achieve a surplus in 2012/13. But while this demonstrates Australia's strong fiscal position to international financial markets, it's likely to work against economic growth at a time when demand is weakening and exports are soft.
It's now likely that the Reserve Bank will need to cut the cash rate by more than previously expected. We now expect another two cuts of 25 basis points each during the next six months and would not rule out the chance of a third cut depending on how the economy is travelling.
The Australian economy has continued to tread water well into 2012. While the mining sector goes from strength to strength, manufacturing, retail, wholesale, tourism and property continue to struggle under the high Australian dollar and consumer caution. However some services sectors, such as health, smaller finance businesses and those connected with mining, have been making solid gains.
Business has been generally critical of many aspects of the Budget and this is why it's important for you to know how your business environment has been affected and where the challenges and opportunities now reside.
In our view, the potential winners from this year's Budget include health services, infrastructure, education and training, agribusiness, free-to-air television and sport. Potential losers include big business, defence, mining, superannuation, transport, banks, housing and property.
Read more Budget analysis at nab.com.au/eofy.
We hope this edition of Business View Connect helps strengthen your business, and we look forward to your feedback at business.view@nab.com.au.
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Regards
Daryl Johnson
Executive General Manager
nabbusiness Australia
