Federal election fails to drive business confidence
Any post-election optimism among businesses was short-lived, according to one business credit index, with the rate of credit demand easing off soon after the election.
The Veda Business Credit Demand Index indicated that the uptick in business credit demand usually experience in a post-election quarter had not fully eventuated in this case.
Veda general manager of commercial risk said in most election years, credit demand sees a significant boost shortly after a newly elected government has been established.
“The September quarter seemed to be following this trend at first, starting strongly in the immediate wake of the federal election. However, the boost was short-lived and demand eased throughout August and September,” Mr Shilbury.
Over the quarter asset finance applications were positive but the growth rate slowed to 2.3 per cent from a rate of 6.7 per cent in the same period the previous year.
The data also showed continued disparity in business credit demand between the mining jurisdictions, at -0.7 per cent, and the non-mining jurisdictions, at 3 per cent.
“There were, however, early signs of recovery among the mining states, with Queensland leading the way,” said Mr Shilbury.
“Queensland’s strong performance across the board, compared to the other mining jurisdictions, indicates the state is emerging from the post-mining boom downturn. In particular, we have seen a notable return to investment in asset finance in Queensland,” he said.