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Australian business confidence at two-year low

Staff writer |
Australia's biggest companies are not confident about 2015, with mining and construction firms the most pessimistic, according to a new survey.

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The National Australia Bank's (NAB) confidence barometer fell by 13 points to minus three during the last three months of 2014, its lowest point since 2012. Australia's top 300 firms surveyed said this lack of confidence would affect their medium-term business investment plans.

"The decline was driven by large mining firms, with overall confidence weakest in mining and construction by some margin," NAB Group chief economist Alan Oster said in a statement.

"Weaker business conditions reflected a drop in profitability and slightly weaker trading conditions, which offset stronger, albeit negative, employment conditions."

With falling commodity prices, mining companies expressed the most negative outlook, and the construction sector also was pessimistic despite record low interest rates.

"Large falls in the mining and transport sectors offset solid gains in recreation and retail, while big construction firms continued to report the weakest conditions overall, possibly reflecting the pullback in mining-related construction," Oster said.

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