Australian Business Confidence Plunges to Record Low
Nov. 11 (Bloomberg) -- Australian business confidence plunged last month to a record low, suggesting the economy may fall into a recession for the first time since 1991.
The sentiment index slumped 21 points to minus 29 from September, the lowest level since the series began in 1989, according to a National Australia Bank Ltd. survey of more than 400 companies conducted between Oct. 23 and Oct. 30.
The threat of a looming global recession is a key reason central bank Governor Glenn Stevens has slashed the benchmark lending rate by 2 percentage points since the start of September to a 3 1/2-year low of 5.25 percent, the biggest reduction in 17 years. Australia's benchmark S&P/ASX Index of stocks is down 4.2 percent today, extending this year's decline to 38 percent.
"Fear reigns supreme," said Alan Oster, chief economist at National Australia in Melbourne. "Continuing volatility in global equity markets, emergency financial packages, falling commodity prices and continuing talk of a global recession have finally broken business optimism." . .
