Business confidence continues recovery: NAB Monthly Business Survey June 2026

14 July 2026
Economy and Markets  Business Banking

• Business confidence rose 9 points in June to -5 index points
• Business conditions steady at +3 index points for a third consecutive month
• Cost and price pressures continue to ease, with retail prices declining for the first time in seven years

Business confidence continued to recover in June as concerns about the economic impact of Middle East tensions eased and cost pressures proved less severe than initially feared, according to the latest NAB Monthly Business Survey. Business confidence rose 9 points to -5 index points, while business conditions remained unchanged at +3 index points for a third consecutive month. 

NAB Chief Economist, Dr Sally Auld, said while confidence remains in negative territory, the survey suggests businesses are becoming less concerned, as the rise in fuel costs and disruption to activity from the Middle East conflict have had a smaller impact on the Australian economy than feared.

“Business confidence has now recovered much of the sharp decline we saw in March, reflecting some easing of concerns around energy markets and as broader geopolitical risks have tempered,” Dr Auld said. 

“Conditions have also stabilised, suggesting that while growth has slowed, activity hasn’t fallen away. That said, the picture is a little softer with conditions and capacity utilisation now at levels below where they started the year. 

“The picture that emerges is one of an economy that is slowing, but not as sharply as many had feared a few months ago.” 

The survey also points to a lower than expected inflation impact from the Middle East conflict with purchase cost growth well down from its March peak, final prices slowing and retail prices falling for the first time in seven years.

Business conditions remain below average, with employment slightly softer, profitability improving and trading conditions broadly unchanged. Capacity utilisation was steady at 82.0%.

“From an inflation perspective, the survey is encouraging. The March cost growth spike has largely unwound and price growth has moderated across most industries,” Dr Auld said. 

“Labour costs remain elevated and margins are still under pressure, but the broader trend is toward easing capacity constraints and more moderate price growth.”

NAB Group Executive Business and Private Banking, Andrew Auerbach, said that while the recovery in business confidence is a positive sign, businesses are still facing a challenging operating environment.

"What we're hearing from customers is that they are feeling more confident about the outlook than they were a few months ago, but price pressures remain a challenge.

"Businesses are looking at every part of their operation to find savings. Some are reducing fuel and transport costs by planning routes more efficiently or investing in more fuel-efficient site equipment, while others are working closely with suppliers and customers to manage costs and keep goods moving," Mr Auerbach said. 

Read the full NAB Monthly Business Survey - June 2026 (PDF, 856KB).