The NAB business survey reported a pullback in business conditions and confidence in July; however, conditions remained above long-run average levels, while confidence was broadly in line. Of the sub-components of conditions, trading conditions and profitability both remain robust, but the employment index is clearly lagging well behind. Turning to the consumer, the August Westpac-Melbourne Institute Consumer Sentiment release reported a jump in overall confidence on the back of stronger perceptions of family finances and the economic outlook – likely driven by greater stability in Greece and China. That being said, the economic outlook indexes remain below their year-ago levels, as does 'time to buy a major household item'. Unemployment expectations also remain elevated. House price expectations point to further gains, but concerns over affordability are clearly present – particularly in NSW. Next week policy meeting minutes from the RBA and FOMC will be in focus.



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