Now that's more like it. The NAB monthly business survey showed both business confidence and conditions on the rise.
Unlike the seemingly inconsistent result from the December survey - where business conditions gained 4 points while business confidence was flat - January's result showed business conditions increased by 6 points to a reading of +16 - the highest since October 2007 -- while confidence rose by 4 points to +10 - the highest since February 2014.
The details of the survey showed that the buoyant January result was due to the continued improvement in trading conditions - up to a reading of 22 in January from 17 in December and 11 in November - as well as in employment which rose to a reading of 7 in January from 2 in December and November.
According to NAB chief economist Alan Oster, "These outcomes are certainly pointing to an improvement in the domestic economy after a soft patch through much of the second half of 2016". However, Oster warned that, "a degree of caution should still be exercised given the diverse and rapidly changing seasonal influences at this time of year (which potentially includes the shift in Chinese New Year to January this year)".
That could be the case given the declines in new orders and exports contained in the survey. New orders fell to a reading of 2 in January from 5 in the previous month while exports decreased to a reading of 0 from 1 in December.
Likewise, NAB Group Economics is also wary over the longer-term growth outlook, "as the contribution from LNG exports, temporarily higher commodity prices and the residential construction boom fade, keeping pressure on the labour market".
However, should the January business survey's bullish result prove more enduring, it would dash speculations for more RBA rate cuts this year. More so, given rising inflation indications in last months' survey.
Labour costs pick up at a quarterly rate of 1.0% in January from 0.6% in December. Purchase costs increased by 0.6% last month from 0.4% in December and final product prices went up by 0.7% from 0.2%.