Business and household surveys show weaker Australian confidence

Australian business and consumer surveys point to weakening sentiment as high interest rates and continuing costs weigh on households and firms. Victoria recorded the weakest business conditions among the states in the latest monthly survey, ahead of its election.

NAB's October measure of business conditions in Victoria fell to minus six points, compared with minus one nationally. An economist said broad pressures were affecting every state, while uncertainty around the Victorian election could also be influencing local expectations.

Consumer confidence fell 2.7 per cent to a four-year low in the Westpac-Melbourne Institute index. Mortgage-holder sentiment dropped 11.6 per cent in November. Higher petrol prices, inflation and the recent interest-rate rise were identified as important pressures on household views.

Consumer-facing businesses, including retail and recreation, showed particular softness in activity measures. Spending had been more resilient than sentiment, leaving the approaching holiday-shopping period an important test rather than a predetermined slump.

The figures have intensified political arguments over living costs and business policy. Polling and opposition criticism form part of that debate, but neither sentiment surveys nor claims made by political leaders establish an election result or a single cause for every business failure.