he NAB business conditions and confidence indices will be released at 11.30 am.
During the mining investment boom these indices have not been a major focus for markets but they are now becoming more important. Business investment in areas outside mining is one of the areas that needs to pick up to replace the hole that will be left by a drop in new mining projects
RBA, Governor Stevens made a point of mentioning that low business confidence was a problem for the economy in his recent speech. So it's clear that this is an important area of focus for the RBA in setting interest policy at the moment.
The NAB indices are based on a survey of 350 businesses. Both the confidence and business conditions numbers are at low levels.
In the years leading up to the GFC, the confidence index ranged between about +4 and +20. Over the past 2 years it has averaged only +2 and last month's reading was 0.
The business conditions index ranged between +10 and +20 for most of the period 2003/2007. Last month's reading was -8.
Lower readings today firm the RBA's bias towards more interest rate cuts and may be a negative for the Aussie Dollar. A strong reading may be a plus.
AUDUSD made a short term peak at .9221 yesterday. Fibonacci retracement levels for a deeper retracement of the .8848 are - 38.2% at .9080 and 50% at .9035.