Business indicators weak

Above find the principle points of today’s ABS March quarter Business Indicators Survey. The two main components are inventories (down .4% vs market expectations of 0.1%) and gross operating profits (-2% v +2% market expectations).

Needless to say, profits are weak but some of the weakness can be put down to floods with mining accounting for a large portion of the slump.

The rise in inventories is either the result of growing confidence that a surge in demand is coming our way or, more likely, is an involuntary accumulation resulting from poor demand.

Both elements are marginal indicators of an ongoing struggling economy.

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About the author

David Llewellyn-Smith is Chief Strategist at the MB Fund and MB Super. David is the founding publisher and editor of MacroBusiness and was the founding publisher and global economy editor of The Diplomat, the Asia Pacific’s leading geo-politics and economics portal. He is also a former gold trader and economic commentator at The Sydney Morning Herald, The Age, the ABC and Business Spectator. He is the co-author of The Great Crash of 2008 with Ross Garnaut and was the editor of the second Garnaut Climate Change Review.