Fed: ACCI survey shows economy weak but stabilising
CANBERRA, Aug 4 AAP - The economy was now weaker than it had been 12 months ago, butwas beginning to stabilise, a survey has found.
The Australian Chamber of Commerce and Industry (ACCI) said its quarterly survey ofbusiness expectations found companies were more optimistic about Australia's economicperformance than they had been during the previous quarter.
But the survey showed there was a general expectation that economic conditions wouldcontinue to slow, with managers' perceptions of conditions within their own companiesfalling sharply.
ACCI said the sales index fell in the September quarter for the fourth time in a row,although investment and employment were on the rise.
ACCI chief executive Peter Hendy said continuing signs of softness in the economy showedthe Reserve Bank should cut interest rates after its monthly meeting tomorrow.
He said the non-farm economy was significantly weaker this year than it had been lastyear, and there was no sign that a rate cut would feed into inflation or overheat theeconomy.
"An interest rate cut should remain a live option," Mr Hendy said.
"Businesses are worried that the continuing slow growth overseas and the relativelyhigh interest rates in Australia will push the economy towards a prolonged period of sub-optimalgrowth."
Most economists expect the Reserve Bank to leave interest rates on hold again this month.
AAP kmh/sw/ak/de ;
KEYWORD: ECONOMY
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