Sydney, 11 November 2025 – Australian business activity accelerated in October, signalling continued resilience in the country’s corporate sector even as confidence edged slightly lower, according to the latest National Australia Bank (NAB) monthly business survey released on Monday.
The NAB Business Conditions Index rose 3 points to +9, marking its strongest reading since March 2024, while the Business Confidence Index slipped 1 point to +1, reflecting cautious sentiment amid persistent cost pressures and global uncertainty.
“Business conditions strengthened across most industries, particularly in transport and utilities, while consumer-facing sectors such as retail and hospitality remain more subdued,” said NAB’s Chief Economist, Alan Oster. “Despite ongoing margin pressures, Australian firms are still reporting solid levels of activity, supported by steady domestic demand.”
Resilient Activity Despite Inflation Concerns
The report indicated that trading conditions, profitability, and employment all improved during October. Trading activity rose 4 points to +14, profitability climbed 3 points to +8, and employment increased 2 points to +7, suggesting a more stable labour environment even as wage costs remain elevated.
While inflationary pressures have moderated from last year’s peaks, businesses continue to face higher costs for materials, energy, and logistics. Price growth in the survey stayed relatively contained, reinforcing expectations that the Reserve Bank of Australia (RBA) may hold its cash rate steady in the near term.
“The data show the economy is still expanding, albeit modestly,” Oster added. “That should give the RBA confidence that its current policy stance is sufficiently restrictive, without stalling momentum.”
Sector Performance and Outlook
- Manufacturing and construction recorded moderate improvements, supported by ongoing infrastructure projects and export demand.
- Transport and utilities saw the biggest month-on-month gains as logistics networks stabilised post-pandemic.
- Retail and hospitality sectors continued to face weaker demand as households adjusted to higher mortgage repayments and cost-of-living constraints.
Forward orders remained broadly stable, with businesses reporting cautious optimism for the year-end period. Many firms, however, continue to cite uncertainty over the global economic outlook and energy costs as downside risks.
Regional and Policy Context
Economists said the survey highlights Australia’s relative economic strength within the Asia-Pacific region, where growth in China and Japan has slowed. Domestic resilience in employment and investment spending has helped offset weaker external demand.
With the RBA expected to maintain its cash rate at 4.35%, attention will now shift to November’s consumer-price index and wage-growth data for confirmation that inflation is easing in line with projections.
