According to data gathered by Roy Morgan Research, business confidence was down 3.4 per cent to 110.6 index points in January, following the December decline of 3.5 per cent and the November drop of 0.5 per cent.
Roy Morgan said the combined drop of 7.3 per cent over the last three months is an indication that the initial increase in confidence following Mr Turnbull’s appointment as prime minister has been outweighed by the negative local and international environments.
“It is not surprising that business confidence has declined further in January, given the negative market sentiment both locally and globally during the month,” Roy Morgan’s industry communications director, Norman Morris, said.
“The continual publicity given to the slowdown in Chinese growth, the dramatic drops in the price of oil and other commodities and the deteriorating budgetary position at home have all impacted negatively on the ASX and business sentiment.
“With business confidence declining, it remains a challenge for both the state and federal governments to create a positive environment and plan that will encourage business growth against what is likely to remain a volatile international economic environment.”
However, the group noted that despite the negative trend in business confidence over the last three months, it is still 7.8 per cent above the level prior to Mr Turnbull’s appointment.