There are some confusing business indicators evident in Australia at present. Interest rates have dropped from 4.75% to 4.5% and unemployment has increased to 5.3%. Retail shop sales are down, however it has been indicated that internet sales, many of which originate overseas, have risen. This would be people taking advantage of the higher value Australian Dollar -v- US Dollar. The exchange rate is moving around. Some experts forecast that in 2012 the Australian Dollar -vs- US Dollar could fall back into the 80’s. There is media speculation that the Australian government will have trouble producing the promised balanced budget for 2013. This will mean that the Australian government is still in deficit which will have a detrimental effect on interest rates. The USA economy is still performing poorly with an official unemployment rate at 8.5%. There are then the problems in Europe and Greece and Italy is now being featured as the next European country that might be feeling the “blow torch” of debtor anger at the way the country has been managed.
All of these factors are affecting business confidence and highlight the need for SMEs to keep their “houses in order” so that these challenges can be addressed.
