ACCI SURVEY OF INVESTOR CONFIDENCE

January 2013

ACCI Survey of Investor Confidence I January 2013

ACCI SURVEY OF INVESTOR CONFIDENCE
CONTENTS
Summary Constraints on Investment - Financial Constraints Remain Prominent Own Business Own Business Conditions - Current Own Business Conditions - Expected Own Sales - Current Own Sales - Expected Own Profitability - Current Own Profitability - Expected Expected Level of Activity Expected Level of Investment Expected Number of Full-Time Employees Expected Capacity in Relation to Demand Actual Sales Compared with the Level Expected Six Months Ago Actual Profits Compared with the Level Expected Six Months Ago National Economy National Economic Conditions - Current National Economic Conditions - Expected Climate for Investment - Current Climate for Investment - Expected Expected GDP Growth Expected Business Investment Expected Movement in Prices Expected Unemployment Rate Expected Wages Growth Expected Interest Rates 2 3 4 4 4 5 5 6 6 7 7 8 8 9 9 10 10 10 11 11 12 12 13 13 14 14

FOREWORD
The ACCI Survey of Investor Confidence is a national survey undertaken through the Australian Chamber of Commerce and Industry’s member associations. The survey covers the three months to December 2012 and had 595 respondents. This survey’s respondents are mainly from the construction and manufacturing industries. For further information contact: Greg Evans, Chief Economist, ACCI on (02) 6273 2311. Note on Interpreting the Data An index level of 50.0 (apart from the Constraints on Investment section) indicates that there is a balance between those who responded positively and negatively. Thus for the most part, a level below 50 indicates that conditions are deteriorating, and conversely, a reading above 50 indicates conditions on average are improving.

1

ACCI Survey of Investor Confidence I January 2013

BUSINESS CONDITIONS AND CONFIDENCE REMAIN DEEP IN NEGATIVE TERRITORY
The January 2013 ACCI Survey of Investor Confidence shows that most actual and expected business indicators remain deep in contractionary territory over the December quarter of 2012, with some indicators falling to their record low levels since the Survey began in 1998. With the exception of Expected Unemployment Rate, all indicators remain below their five year averages over the quarter.

Own Business
While the current indexes of Own Business Conditions (p.4), Sales (p.5) and Profitability (p.6) improved over the December quarter, business expectations for these three indicators have continued to decline to their new record low levels. These readings indicate that business sentiment remains extremely weak for the first quarter of 2013, despite recent improvement in business trading conditions. The index of Expected Number of Full-Time Employees (p.8) fell to its new 15-year low over the quarter, indicating business hiring intentions over the first half of 2013 remain anaemic.

National Economy
While actual index of National Economic Conditions (p.10) recovered marginally from its historic low in December, the indicator for Climate for Investment (p.11) continued to fall to its lowest level in the survey’s 15 year history. Their expectation indicators for the first quarter of 2013 have continued to decline to their lowest levels since June 2009, indicating that businesses are becoming increasingly pessimistic about Australia’s economic performance and the climate for business investment. Over the next twelve months, business expects price pressure (p.13) to remain contained, consistent with an expected fall in interest rates (p.14). It is concerning that the unemployment rate (p.13) for the next twelve months only fell marginally from its recent peak and economy-wide wage growth (p.14) is expected to remain elevated, despite recent falls.

Quarterly Constraints on Investment
ACCI’s quarterly index of Constraints on Investment (p.3) found that Business Taxes and Government Charges remained the largest constraint on business investment for the 18th successive quarter. It is concerning that government regulatory requirements have inhibited business capital expenditure plans, with Federal Government Regulations and Local Government Regulations increasing to the third and eighth positions respectively, while State Government Regulations remaining the fifth largest impediment on business investment.

2

ACCI Survey of Investor Confidence I January 2013

CONSTRAINTS ON INVESTMENT – RED TAPE BURDEN REMAINS PROMINENT
The ACCI Survey of Investor Confidence seeks information from respondents on the importance of a list of twenty factors as constraints on the level of investment in plant and equipment. The overall, or average, index level for all constraints showed that constraints on investment remained at 36.1 over the December quarter. The list presented below shows the ten most important constraints on business investment and shows that the current major impediments to investment flow from four main sources: government taxes and regulations, the labour market, financial issues such as the level of interest rates and bank charges, as well as macroeconomic conditions. Business Taxes and Government Charges remained the largest constraint on business investment for the 18th successive quarter in December. It is concerning that government regulatory requirements have put significant constraints on business capital expenditure plans. While State Government Regulations remained at the fifth position in the December quarter, Federal Government Regulations and Local Government Regulations have increased from the seventh and tenth positions to the third and eighth largest impediments on investment respectively over the quarter. These findings clearly indicated that government levies and regulations continued to impose unnecessary upward pressure on the cost of doing business. Soft domestic demand and weak business sentiment have caused Insufficient Demand to remain the second largest constraint on investment, and Local Competition to fall from the sixth to ninth position in the December quarter. Softer labour market conditions have seen Wage Costs edged lower from the third to fourth position; and Non-Wage Labour Costs fell from the fourth to sixth position over the same period. Financial constraints remained prominent in the top ten over the December quarter, with Insufficient Retained Earnings increasing to the seventh position and Current Levels of Debt falling to the tenth position.

Top Ten Constraints on Investment
1. Business Taxes and Government Charges (1) 2. Insufficient Demand (2) 3. Federal Government Regulations (7) 4. Wage Costs (3) 5. State Government Regulations (5) 6. Non-Wage Labour Costs (4) 7. Insufficient Retained Earnings (8) 8. Local Government Regulations (10) 9. Local Competition (6) 10. Current Levels of Debt (9) The figures in brackets show the ranking in the September 2012 quarter.

3

ACCI Survey of Investor Confidence I January 2013

OWN BUSINESS
This section presents an analysis of the assessments businesses have made about their own firm’s current performance.

Own Business Conditions - Current
The index of Own Business Conditions - Current, which asks respondents to make a general evaluation of their own business trading conditions, increased from 48.0 to 49.2 over the December quarter. Nonetheless, the index remains almost four points below its five year average of 53.1.
Jan 2012
SA Trend

Oct 2012
8.4% 2.5% 15.9% 19.8% 42.4% 6.9% 4.1% 46.3 46.6 48.0

Jan 2013
3.1% 15.1% 20.0% 28.0% 21.8% 11.0% 1.0% 52.1 51.5 49.2

Excellent
75 70 65

2.4% 7.8% 24.2% 29.9% 22.4% 8.8% 4.6% 48.9 48.3 48.7

75 70 65

Very Good Good Satisfactory
Index Level

Index Level

60
55 50 45

60
55 50 45

Poor Very Poor Deeply Depressed Original Seasonally Adjusted Trend

Own Business Conditions - Expected
The Own Business Conditions - Expected declined marginally to 46.2 from 47.6 over the last three months, to be almost four points below the level recorded twelve months earlier. This reading indicates that businesses expect their trading conditions to deteriorate over the first quarter of 2013.
Jan 2012
SA Trend

Jan-98 Jul-98 Jan-99 Jul-99 Jan-00 Jul-00 Jan-01 Jul-01 Jan-02 Jul-02 Jan-03 Jul-03 Jan-04 Jul-04 Jan-05 Jul-05 Jan-06 Jul-06 Jan-07 Jul-07 Jan-08 Jul-08 Jan-09 Jul-09 Jan-10 Jul-10 Jan-11 Jul-11 Jan-12 Jul-12 Jan-13

Oct 2012
0.6% 18.6% 56.8% 19.9% 4.1% 48.0 48.1 47.6

Jan 2013
3.1% 5.7% 63.1% 26.6% 1.5% 45.6 45.3 46.2

Improving Rapidly
75 70 65

1.3% 27.4% 46.8% 23.6% 1.1% 51.0 50.7 50.1

75 70 65

Improving Slowly No Change Deteriorating Slowly Deteriorating Rapidly Original Seasonally Adjusted Trend
Index Level

Index Level

60 55
50 45 40

60 55
50 45 40

Jan-98 Jul-98 Jan-99 Jul-99 Jan-00 Jul-00 Jan-01 Jul-01 Jan-02 Jul-02 Jan-03 Jul-03 Jan-04 Jul-04 Jan-05 Jul-05 Jan-06 Jul-06 Jan-07 Jul-07 Jan-08 Jul-08 Jan-09 Jul-09 Jan-10 Jul-10 Jan-11 Jul-11 Jan-12 Jul-12 Jan-13

4

ACCI Survey of Investor Confidence I January 2013

Own Sales - Current
The index of Own Sales - Current rose to 49.0 from 47.5 over the December quarter, the highest level since the March quarter of 2011. Nonetheless, the index remains almost two points below its five year average of 50.9.

Jan 2012
SA Trend

Oct 2012
8.3% 9.8% 9.6% 20.4% 41.3% 6.4% 4.3% 47.9 48.1 47.5

Jan 2013
2.9% 15.2% 19.9% 25.5% 24.1% 6.8% 5.6% 50.7 50.1 49.0

Excellent
75 70 65

2.1% 6.8% 28.0% 20.6% 29.2% 7.2% 6.0% 47.7 47.1 47.3

75 70 65

Very Good Good Satisfactory Poor Very Poor Deeply Depressed Original Seasonally Adjusted
Index Level

Index Level

60 55

60 55

50
45 40

50
45 40

Jan-98 Jul-98 Jan-99 Jul-99 Jan-00 Jul-00 Jan-01 Jul-01 Jan-02 Jul-02 Jan-03 Jul-03 Jan-04 Jul-04 Jan-05 Jul-05 Jan-06 Jul-06 Jan-07 Jul-07 Jan-08 Jul-08 Jan-09 Jul-09 Jan-10 Jul-10 Jan-11 Jul-11 Jan-12 Jul-12 Jan-13

Trend

Own Sales - Expected
The index of Own Sales - Expected fell further from 48.8 to 46.3 over the quarter, the lowest level since the survey began in 1998 and remained more than nine points below its five year average of 55.5. This reading indicates that businesses are expecting their sales to deteriorate further over the March quarter.
Jan 2012
SA Trend

Oct 2012
0.5% 29.7% 45.3% 21.1% 3.3% 50.8 50.7 48.8

Jan 2013
0.0% 7.6% 64.0% 23.9% 4.5% 43.7 43.4 46.3

75 70 65

75 70 65

Improving Rapidly Improving Slowly No Change Deteriorating Slowly Deteriorating Rapidly Original Seasonally Adjusted Trend
Index Level

0.5% 26.3% 41.7% 30.1% 1.3% 48.7 48.4 49.1

Index Level

60 55

60 55

50
45 40

50
45 40

Jan-98 Jul-98 Jan-99 Jul-99 Jan-00 Jul-00 Jan-01 Jul-01 Jan-02 Jul-02 Jan-03 Jul-03 Jan-04 Jul-04 Jan-05 Jul-05 Jan-06 Jul-06 Jan-07 Jul-07 Jan-08 Jul-08 Jan-09 Jul-09 Jan-10 Jul-10 Jan-11 Jul-11 Jan-12 Jul-12 Jan-13

5

ACCI Survey of Investor Confidence I January 2013

Own Profitability - Current
The index of Own Profitability - Current edged up to 44.2 from 43.5 in December. The index is virtually unchanged from the level recorded 12 months earlier and remains 2.6 points below its five year average of 46.8, indicating business profitability has remained under significant pressure despite the increase recorded during the December quarter.
Jan 2012
SA Trend

Oct 2012
8.4% 1.2% 6.1% 25.1% 43.9% 9.5% 5.9% 42.2 42.1 43.5

Jan 2013
2.9% 7.8% 25.7% 22.3% 19.3% 17.2% 4.9% 46.9 46.5 44.2

Excellent
70 65 60

1.4% 6.2% 21.5% 23.0% 32.1% 8.8% 7.1% 44.5 44.1 44.7

70 65 60

Very Good Good Satisfactory Poor Very Poor Deeply Depressed Original Seasonally Adjusted Trend
Index Level

Index Level

55 50 45 40

55 50 45 40

Own Profitability - Expected
The index of Own Profitability – Expected declined from 46.5 to its new historical low of 45.1 over the quarter, indicating businesses have become increasingly pessimistic about their business profitability in early 2013.

Jan-98 Jul-98 Jan-99 Jul-99 Jan-00 Jul-00 Jan-01 Jul-01 Jan-02 Jul-02 Jan-03 Jul-03 Jan-04 Jul-04 Jan-05 Jul-05 Jan-06 Jul-06 Jan-07 Jul-07 Jan-08 Jul-08 Jan-09 Jul-09 Jan-10 Jul-10 Jan-11 Jul-11 Jan-12 Jul-12 Jan-13

Jan 2012
SA Trend

Oct 2012
0.4% 20.9% 46.8% 27.3% 4.6% 46.3 46.5 46.5

Jan 2013
0.2% 11.2% 57.9% 25.7% 5.0% 44.0 43.9 45.1

Improving Rapidly
70 65 60

0.4% 24.4% 42.6% 29.2% 3.4% 47.3 47.2 46.6

70 65 60

Improving Slowly No Change Deteriorating Slowly
Index Level

Index Level

55 50
45 40 35

55 50
45 40 35

Deteriorating Rapidly Original Seasonally Adjusted Trend

Jan-98 Jul-98 Jan-99 Jul-99 Jan-00 Jul-00 Jan-01 Jul-01 Jan-02 Jul-02 Jan-03 Jul-03 Jan-04 Jul-04 Jan-05 Jul-05 Jan-06 Jul-06 Jan-07 Jul-07 Jan-08 Jul-08 Jan-09 Jul-09 Jan-10 Jul-10 Jan-11 Jul-11 Jan-12 Jul-12 Jan-13

6

ACCI Survey of Investor Confidence I January 2013

Expected Level of Activity
The index of Expected Level of Activity edged down to 47.1 from 47.7 over the December quarter, to be more than six points below its five year average of 53.4 and the lowest level since June 2009. The reading indicates that businesses expect their business activity to decline further over the first half of 2013.

Jan 2012
SA Trend

Oct 2012
0.0% 21.2% 53.4% 19.9% 5.4% 47.6 47.4 47.7

Jan 2013
2.6% 19.5% 43.3% 31.4% 3.2% 46.8 46.6 47.1

70 65 60

70 65 60

Much Higher Somewhat Higher About the Same Somewhat Lower Much Lower Original Seasonally Adjusted Trend
Index Level

0.7% 32.2% 51.3% 14.3% 1.6% 54.0 53.8 50.5

Index Level

55 50 45 40

55 50 45 40

Expected Level of Investment
The index of Expected Level of Investment remained relatively unchanged at 37.4 over the last three months, with the index remaining 12.6 points below the 50 mark, which separates expansion from contraction. This indicates that businesses’ future capital expenditure plans for the next six months are expected to remain weak.
Jan 2012
SA Trend

Jan-98 Jul-98 Jan-99 Jul-99 Jan-00 Jul-00 Jan-01 Jul-01 Jan-02 Jul-02 Jan-03 Jul-03 Jan-04 Jul-04 Jan-05 Jul-05 Jan-06 Jul-06 Jan-07 Jul-07 Jan-08 Jul-08 Jan-09 Jul-09 Jan-10 Jul-10 Jan-11 Jul-11 Jan-12 Jul-12 Jan-13

Oct 2012
0.0% 16.4% 35.6% 26.2% 21.7% 36.7 36.7 37.3

Jan 2013
2.6% 1.7% 55.0% 24.2% 16.5% 37.4 37.5 37.4

60 55

60 55

Much Higher Somewhat Higher About the Same Somewhat Lower Much Lower Original Seasonally Adjusted Trend
Index Level

0.9% 4.0% 62.8% 24.9% 7.5% 41.5 41.6 38.3

50

50
45

Index Level

45

40
35

40
35

Jan-98 Jul-98 Jan-99 Jul-99 Jan-00 Jul-00 Jan-01 Jul-01 Jan-02 Jul-02 Jan-03 Jul-03 Jan-04 Jul-04 Jan-05 Jul-05 Jan-06 Jul-06 Jan-07 Jul-07 Jan-08 Jul-08 Jan-09 Jul-09 Jan-10 Jul-10 Jan-11 Jul-11 Jan-12 Jul-12 Jan-13

30

30

7

ACCI Survey of Investor Confidence I January 2013

Expected Number of Full-Time Employees
The index of Expected Number of Full-Time Employees declined marginally to 42.6 over the December quarter, to be 4.9 points below its five year average of 47.5. The reading indicates that business hiring intention over the next six months is at its new historic low level.

SA

Trend

Jan 2012
60

Oct 2012
0.0% 2.9% 65.6% 26.3% 5.3% 41.5 41.0 42.7

Jan 2013
0.0% 1.0% 73.2% 24.0% 1.7% 43.4 43.6 42.6

60

Much Higher Somewhat Higher About the Same Somewhat Lower Much Lower Original Seasonally Adjusted Trend
Index Level

0.4% 5.3% 70.4% 22.5% 1.4% 45.2 45.4 44.1

55

55

Index Level

50

50

45

45

Expected Capacity in Relation to Demand
Expected Capacity in Relation to Demand increased marginally from 57.7 to 58.0 over the December quarter, indicating that excess capacity within business to increase output is expected to remain more than adequate over the next six months.
Jan 2012
SA Trend

Jan-98 Jul-98 Jan-99 Jul-99 Jan-00 Jul-00 Jan-01 Jul-01 Jan-02 Jul-02 Jan-03 Jul-03 Jan-04 Jul-04 Jan-05 Jul-05 Jan-06 Jul-06 Jan-07 Jul-07 Jan-08 Jul-08 Jan-09 Jul-09 Jan-10 Jul-10 Jan-11 Jul-11 Jan-12 Jul-12 Jan-13

40

40

Oct 2012
30.1% 56.4% 13.5% 58.3 57.8 57.7

Jan 2013
27.1% 59.9% 13.0% 57.1 57.9 58.0

More than Adequate
70

28.9% 57.1% 14.0% 57.4 58.3 58.2

70

Adequate Less than Adequate Original Seasonally Adjusted Trend
Index Level

65

65

Index Level

60

60

55

55

50

50

Jan-98 Jul-98 Jan-99 Jul-99 Jan-00 Jul-00 Jan-01 Jul-01 Jan-02 Jul-02 Jan-03 Jul-03 Jan-04 Jul-04 Jan-05 Jul-05 Jan-06 Jul-06 Jan-07 Jul-07 Jan-08 Jul-08 Jan-09 Jul-09 Jan-10 Jul-10 Jan-11 Jul-11 Jan-12 Jul-12 Jan-13

45

45

8

ACCI Survey of Investor Confidence I January 2013

Actual Sales Compared with the Level Expected Six Months Ago
The index of Actual Sales Compared with the Level Expected Six Months Ago rose from 35.7 to 37.2 over the last quarter, the highest level since June 2011. Nonetheless, the index remained deep in contractionary territory indicating that sales over the December quarter continued to fall significantly short of the projections of six months ago.

Jan 2012
SA Trend

Oct 2012
0.1% 13.8% 20.5% 52.3% 13.3% 33.7 33.8 35.7

Jan 2013
0.1% 17.1% 31.7% 46.9% 4.2% 40.5 39.5 37.2

60
55

60
55

Much Higher Somewhat Higher About the Same Somewhat Lower Much Lower Original Seasonally Adjusted Trend
Index Level

0.3% 8.1% 44.6% 38.4% 8.7% 38.2 37.2 36.1

50

50
45

Index Level

45

40
35

40
35

Actual Profits Compared with the Level Expected Six Months Ago
The index of Actual Profits Compared with the Level Expected Six Months Ago increased marginally to 35.2 in December, indicating actual profits continued to fall well below the June quarter predictions.

Jan-98 Jul-98 Jan-99 Jul-99 Jan-00 Jul-00 Jan-01 Jul-01 Jan-02 Jul-02 Jan-03 Jul-03 Jan-04 Jul-04 Jan-05 Jul-05 Jan-06 Jul-06 Jan-07 Jul-07 Jan-08 Jul-08 Jan-09 Jul-09 Jan-10 Jul-10 Jan-11 Jul-11 Jan-12 Jul-12 Jan-13

30

30

SA

Trend

Jan 2012
60 55 50

Oct 2012
0.0% 9.9% 29.7% 39.7% 20.7% 32.2 32.4 34.6

Jan 2013
0.0% 15.5% 32.3% 40.3% 11.9% 37.8 37.4 35.2

60 55 50

Much Higher Somewhat Higher About the Same Somewhat Lower Much Lower Original Seasonally Adjusted Trend
Index Level

0.3% 6.4% 40.4% 38.1% 14.7% 34.9 34.5 35.4

Index Level

45 40 35 30

45 40 35 30

Jan-98 Jul-98 Jan-99 Jul-99 Jan-00 Jul-00 Jan-01 Jul-01 Jan-02 Jul-02 Jan-03 Jul-03 Jan-04 Jul-04 Jan-05 Jul-05 Jan-06 Jul-06 Jan-07 Jul-07 Jan-08 Jul-08 Jan-09 Jul-09 Jan-10 Jul-10 Jan-11 Jul-11 Jan-12 Jul-12 Jan-13

9

ACCI Survey of Investor Confidence I January 2013

NATIONAL ECONOMY
This section presents analysis of the assessments business has made regarding the current state of the national economy.

National Economic Conditions - Current
The index of National Economic Conditions - Current, which measures business evaluation of the general state of the Australian economy, recovered marginally from its 15-year low of 38.7 to 40.0 over the December quarter, leaving it more than seven points below its five year average of 47.4. The index remains significantly below the 50 mark and four points below the level recorded 12 months earlier indicating that business remains pessimistic about the current strength of the Australian economy.
Jan 2012
SA Trend

Oct 2012
0.7% 3.1% 19.7% 10.7% 35.1% 17.0% 13.7% 36.3 36.6 38.7

Jan 2013
0.4% 7.8% 16.6% 27.7% 27.8% 18.2% 1.5% 44.1 43.2 40.0

Excellent
75 70

1.5% 7.7% 20.2% 31.7% 24.7% 9.5% 4.7% 47.0 46.0 44.0

75 70

Very Good Good Satisfactory Poor Very Poor Deeply Depressed Original Seasonally Adjusted Trend
Index Level

65

65
60 55

Index Level

60 55

50
45 40

50
45 40

National Economic Conditions - Expected
Businesses expect national economic conditions to remain relatively unchanged over the next three months, with the index of National Economic Conditions – Expected firming at 42.7 in the December quarter. The expectations index has declined 1.3 points over the past 12 months indicating business expects Australian economic growth to remain weak over the first quarter of 2013.
Jan 2012
SA Trend

Jan-98 Jul-98 Jan-99 Jul-99 Jan-00 Jul-00 Jan-01 Jul-01 Jan-02 Jul-02 Jan-03 Jul-03 Jan-04 Jul-04 Jan-05 Jul-05 Jan-06 Jul-06 Jan-07 Jul-07 Jan-08 Jul-08 Jan-09 Jul-09 Jan-10 Jul-10 Jan-11 Jul-11 Jan-12 Jul-12 Jan-13

35

35

Oct 2012
0.4% 16.2% 50.5% 28.0% 4.8% 44.8 44.4 42.8

Jan 2013
2.6% 6.2% 55.9% 26.1% 9.1% 41.8 41.3 42.7

65 60 55

65 60 55 50

Improving Rapidly Improving Slowly No Change Deteriorating Slowly Deteriorating Rapidly Original Seasonally Adjusted Trend
Index Level

1.5% 26.6% 34.2% 34.4% 3.3% 47.2 46.7 44.0

Index Level

50

45
40 35 30 25

45
40 35 30 25

Jan-98 Jul-98 Jan-99 Jul-99 Jan-00 Jul-00 Jan-01 Jul-01 Jan-02 Jul-02 Jan-03 Jul-03 Jan-04 Jul-04 Jan-05 Jul-05 Jan-06 Jul-06 Jan-07 Jul-07 Jan-08 Jul-08 Jan-09 Jul-09 Jan-10 Jul-10 Jan-11 Jul-11 Jan-12 Jul-12 Jan-13

10

ACCI Survey of Investor Confidence I January 2013

Climate for Investment - Current
The Climate for Investment - Current fell marginally to its new historical low level of 34.1 over the last three months, to be 7.7 points below its five year average of 41.8. The index remains almost 16 points below the 50 mark, which separates expansion from contraction, suggesting that weak domestic economic conditions and global economic uncertainties continue to dampen business investment plans.
Jan 2012
SA Trend

Oct 2012
0.4% 0.2% 9.5% 19.8% 38.6% 25.1% 6.5% 33.8 34.0 34.2

Jan 2013
0.0% 3.2% 3.6% 38.6% 21.1% 22.3% 11.2% 35.1 34.7 34.1

Excellent
70 65 60 55

0.0% 4.2% 4.8% 23.4% 49.8% 14.2% 3.7% 37.4 36.9 36.7

70 65 60

Very Good Good Satisfactory Poor Very Poor Deeply Depressed Original Seasonally Adjusted Trend
Index Level

Index Level

55

50
45 40 35 30

50
45 40 35 30

Climate for Investment - Expected
The index of Climate for Investment - Expected fell to 41.7 from 43.4 over the December quarter, to be 4.8 points below its five year average of 46.5 and the lowest level since June 2009. This reading indicates that business expects the decline in general investment conditions to worsen over the next three months.
Jan 2012
SA Trend

Jan-98 Jul-98 Jan-99 Jul-99 Jan-00 Jul-00 Jan-01 Jul-01 Jan-02 Jul-02 Jan-03 Jul-03 Jan-04 Jul-04 Jan-05 Jul-05 Jan-06 Jul-06 Jan-07 Jul-07 Jan-08 Jul-08 Jan-09 Jul-09 Jan-10 Jul-10 Jan-11 Jul-11 Jan-12 Jul-12 Jan-13

Oct 2012
0.3% 20.8% 55.4% 18.9% 4.6% 48.4 48.1 43.4

Jan 2013
2.5% 1.6% 50.9% 34.3% 10.6% 37.8 37.3 41.7

Improving Rapidly
65 60

0.2% 16.2% 59.6% 21.2% 2.8% 47.5 46.8 44.2

65 60

Improving Slowly No Change Deteriorating Slowly Deteriorating Rapidly Original Seasonally Adjusted Trend
Index Level

55

55
50 45 40 35 30

Index Level

50 45 40 35 30

Jan-98 Jul-98 Jan-99 Jul-99 Jan-00 Jul-00 Jan-01 Jul-01 Jan-02 Jul-02 Jan-03 Jul-03 Jan-04 Jul-04 Jan-05 Jul-05 Jan-06 Jul-06 Jan-07 Jul-07 Jan-08 Jul-08 Jan-09 Jul-09 Jan-10 Jul-10 Jan-11 Jul-11 Jan-12 Jul-12 Jan-13

25

25

11

ACCI Survey of Investor Confidence I January 2013

Expected GDP Growth
The index of Expected GDP Growth declined from 40.5 to 38.6 over the December quarter, the lowest level since June 2009, suggesting that businesses expect the Australian economy to slow significantly in 2013.

Jan 2012
SA Trend

Oct 2012
0.0% 1.9% 62.2% 24.8% 11.1% 38.8 38.7 40.5

Jan 2013
0.3% 4.2% 54.8% 38.6% 2.1% 40.5 40.5 38.6

65 60 55 50

65 60 55 50

Much Higher Somewhat Higher About the Same
Index Level

0.4% 6.6% 51.9% 39.0% 2.1% 41.0 41.0 42.3

Index Level

45
40 35 30 25

45
40 35 30 25

Somewhat Lower Much Lower Original Seasonally Adjusted Trend

Expected Business Investment
The index of Expected Business Investment, which measures business expectations for investment growth nationally over the next twelve months, declined further from 34.6 to 33.2 over the last quarter, the lowest level since June 2009. The negative reading indicates that businesses expect aggregate business investment to remain contractionary over the next twelve months.
Jan 2012
SA Trend

Jan-98 Jul-98 Jan-99 Jul-99 Jan-00 Jul-00 Jan-01 Jul-01 Jan-02 Jul-02 Jan-03 Jul-03 Jan-04 Jul-04 Jan-05 Jul-05 Jan-06 Jul-06 Jan-07 Jul-07 Jan-08 Jul-08 Jan-09 Jul-09 Jan-10 Jul-10 Jan-11 Jul-11 Jan-12 Jul-12 Jan-13

20

20

Oct 2012
0.0% 4.2% 36.4% 42.9% 16.5% 32.1 31.9 34.6

Jan 2013
0.0% 4.1% 37.0% 47.8% 11.0% 33.6 33.5 33.2

Much Higher
60 55 50 45 40 35 30 25 20

0.2% 8.2% 46.3% 39.1% 6.2% 39.3 39.1 37.5

60 55 50

Somewhat Higher About the Same Somewhat Lower Much Lower Original Seasonally Adjusted Trend
Index Level

Index Level

45 40 35 30 25 20

Jan-98 Jul-98 Jan-99 Jul-99 Jan-00 Jul-00 Jan-01 Jul-01 Jan-02 Jul-02 Jan-03 Jul-03 Jan-04 Jul-04 Jan-05 Jul-05 Jan-06 Jul-06 Jan-07 Jul-07 Jan-08 Jul-08 Jan-09 Jul-09 Jan-10 Jul-10 Jan-11 Jul-11 Jan-12 Jul-12 Jan-13

12

ACCI Survey of Investor Confidence I January 2013

Expected Movement in Prices
The index of Expected Movement in Prices rose marginally to 52.6 from 51.9 over the December quarter, to be more than six points below its five year average of 59.0. This reading suggests inflation pressures are expected to remain under control over the next twelve months.
Jan 2012
SA Trend

Oct 2012
0.2% 24.8% 56.8% 15.1 % 3.1% 51.0 49.9 51.9

Jan 2013
0.4% 25.7% 66.5% 6.8% 0.7% 54.6 55.5 52.6

80 75

80 75

Much Higher Somewhat Higher About the Same
Index Level

2.5% 16.2% 57.3% 23.6% 0.4% 49.2 50.1 53.8

70

70
65 60

Index Level

65 60

Somewhat Lower Much Lower Original Seasonally Adjusted Trend

55
50 45

55
50 45

Expected Unemployment Rate
The Expected Unemployment Rate fell marginally from its recent peak of 64.3 to 63.9 over the last three months, to be 2.2 points higher over the year and almost two points above its five year average of 62.2. This reading suggests that business expects labour market conditions to soften significantly over the next twelve months.
Jan 2012
SA Trend

Jan-98 Jul-98 Jan-99 Jul-99 Jan-00 Jul-00 Jan-01 Jul-01 Jan-02 Jul-02 Jan-03 Jul-03 Jan-04 Jul-04 Jan-05 Jul-05 Jan-06 Jul-06 Jan-07 Jul-07 Jan-08 Jul-08 Jan-09 Jul-09 Jan-10 Jul-10 Jan-11 Jul-11 Jan-12 Jul-12 Jan-13

40

40

Oct 2012
15.1% 42.2% 34.8% 7.4% 0.5% 66.0 65.6 64.3

Jan 2013
1.7% 56.4% 28.2% 13.4% 0.3% 61.5 61.7 63.9

Much Higher
75 70 65

4.8% 46.5% 28.5% 19.3% 0.9% 58.8 59.0 61.7

75 70 65

Somewhat Higher About the Same Somewhat Lower Much Lower Original Seasonally Adjusted Trend
Index Level

Index Level

60 55
50 45 40

60 55
50 45 40

Jan-98 Jul-98 Jan-99 Jul-99 Jan-00 Jul-00 Jan-01 Jul-01 Jan-02 Jul-02 Jan-03 Jul-03 Jan-04 Jul-04 Jan-05 Jul-05 Jan-06 Jul-06 Jan-07 Jul-07 Jan-08 Jul-08 Jan-09 Jul-09 Jan-10 Jul-10 Jan-11 Jul-11 Jan-12 Jul-12 Jan-13

13

ACCI Survey of Investor Confidence I January 2013

Expected Wages Growth
The Expected Wages Growth edged down from 52.8 to 51.6 over the December quarter, to be 2.5 points below its five year average of 54.1. The reading suggests that wages growth is expected to decline further over the next twelve months. It is important to note that this expectation is for economy-wide wages growth and not firms’ own payroll.
Jan 2012
SA Trend

Oct 2012
0.9% 18.6% 72.2% 8.3% 0.0% 51.0 51.6 52.8

Jan 2013
0.4% 18.9% 74.3% 6.5% 0.0% 51.8 51.9 51.6

70 65 60

70 65 60

Much Higher Somewhat Higher About the Same
Index Level

0.8% 33.2% 57.1% 9.0% 0.0% 54.2 54.5 55.2

Index Level

55 50
45 40 35

55 50
45 40 35

Somewhat Lower Much Lower Original Seasonally Adjusted Trend

Expected Interest Rates
The index of Expected Interest Rates, which asks businesses about their interest rate expectations, showed that businesses expect interest rates to fall further in 2013. The index declined from 39.5 to 38.8 over the quarter, the lowest level since the March quarter of 2009.
Jan 2012
SA Trend

Jan-98 Jul-98 Jan-99 Jul-99 Jan-00 Jul-00 Jan-01 Jul-01 Jan-02 Jul-02 Jan-03 Jul-03 Jan-04 Jul-04 Jan-05 Jul-05 Jan-06 Jul-06 Jan-07 Jul-07 Jan-08 Jul-08 Jan-09 Jul-09 Jan-10 Jul-10 Jan-11 Jul-11 Jan-12 Jul-12 Jan-13

Oct 2012
0.4% 11.9% 45.0% 42.6% 0.0% 42.5 42.8 39.5

Jan 2013
0.0% 1.2% 43.5% 54.9% 0.4% 36.4 38.3 38.8

Much Higher
90 80 70

0.0% 2.3% 42.1% 55.6% 0.0% 36.7 38.6 45.1

90 80 70

Somewhat Higher About the Same Somewhat Lower Much Lower Original Seasonally Adjusted Trend
Index Level

Index Level

60 50 40 30 20

60 50 40 30 20

Jan-98 Jul-98 Jan-99 Jul-99 Jan-00 Jul-00 Jan-01 Jul-01 Jan-02 Jul-02 Jan-03 Jul-03 Jan-04 Jul-04 Jan-05 Jul-05 Jan-06 Jul-06 Jan-07 Jul-07 Jan-08 Jul-08 Jan-09 Jul-09 Jan-10 Jul-10 Jan-11 Jul-11 Jan-12 Jul-12 Jan-13

14

Sign up to vote on this title
UsefulNot useful