NAB: Business confidence plunges, echoing GFC and COVID falls

14 April 2026
Economy and Markets

• Business confidence fell sharply in March following global geopolitical shock
• Business conditions held relatively steady, signalling prior economic momentum
• Cost pressures lifted quickly, with purchase costs and prices rising

Business confidence fell sharply in March as heightened global uncertainty weighed heavily on sentiment, while business conditions remained resilient, according to the latest NAB Monthly Business Survey.

The March survey shows business confidence fell 29 points to –29 index points. Business conditions eased only marginally to +6 index points, just below their long-run average.

NAB Head of Australian Economics Gareth Spence said the divergence between confidence and conditions highlights how quickly sentiment can respond to global shocks, even as activity data remains more stable in the near term.

“The outbreak of the conflict in the Middle East saw business confidence fall 29 points to minus 29 index points, the second largest monthly fall in the survey’s history, with falls of this magnitude previously only seen in the GFC and the onset of COVID,” Mr Spence said.

“Business conditions fell only one point to six index points in March, reflecting that while the global news backdrop has impacted sentiment, it is still early days in terms of the flow through to activity.”

“Resilience in business conditions also highlights that the economy had carried a healthy level of momentum heading into the unfolding shock.”

Forward orders fell sharply in March, erasing gains seen earlier in the year and pointing to rising caution among firms. Capacity utilisation, however, rose to 83.1 per cent and remains well above its long-run average.

“The forward orders measure fell six points to minus one index point, erasing the gains made so far through 2026 and possibly reflecting rising uncertainty,” Spence said.

“The impact on measures of costs and prices has been immediately obvious, with purchase cost growth in quarterly terms more than doubling to three per cent and product price growth rising to 1.1 per cent.”

Business confidence is now negative across all states, while business conditions remain positive in most regions. Western Australia and South Australia recorded improvements in conditions over the month, while Victoria saw the largest decline.

To read the full report click below.

NAB Monthly Business Survey March 2026 (PDF, 769KB)