Australian business conditions hold strong in Aug, cost pressure elevated

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SYDNEY, Sept 12 - Australian business conditions proved resilient yet again in August with a broad uptick in sales, profits and jobs, while inflationary pressures remained elevated, a result that could add to the case for more monetary tightening to tame inflation.

The survey's measure of employment gained 3 points to +9, while the sales index picked up 1 point to +18 and profitability rose 2 points to +13. "There was a notable rise in the employment index which is well above the long-run average, suggesting labour demand has remained strong into the second half of the year," said NAB's chief economist Alan Oster.

Indeed, growth in labour costs was 3.2% higher in the past three months, easing a little from the previous reading of 3.7%, while purchasing costs picked up to 2.9% from 2.8%.

 

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