Businesses are more optimistic about the prospects of bumper Christmas sales - but the all-powerful Aussie dollar may ruin the festivities.
Amid a slew of contrasting research released yesterday, business expectations among Australian companies soared to a nine-year high, according to Dun & Bradstreet. But the researchers admitted the strength of the local currency would influence December sales results.
More than half of the businesses surveyed by Dun & Bradstreet said they were banking on an increase in sales in the December quarter, the strongest figure since late 2003.
The National Business Expectations Survey found that 40 per cent of executives were anticipating profit growth over the Christmas period, with 20 per cent of employers saying they would put on more staff.
At the same time, an Australian Chamber of Commerce and Industry expectations survey predicted employment would fall in September because of an uncertain economic outlook and difficult trading conditions.
Dun & Bradstreet director Adam Siddique said the Aussie dollar's return above $US1.05 could hamper business.
Nearly 30 per cent of businesses said they were concerned about the negative impact of the high dollar, twice as many as a year ago.
"The buoyant short term outlook is in sharp contrast to recent uncertainty and bodes well for a strong December quarter driven by expectations of solid Christmas trading," Mr Siddique said.
He said retail firms had been hard hit because of a drop in discretionary spending and a shift to online.
"This is particularly positive given some retail small businesses have indicated they can generate up to one-third of annual turnover during the December quarter," he said.
While there were some glimmers of hope, the ACCI survey warns conditions remain negative.
The expectations index on general business conditions remained below the 50 mark which separates expansion from contraction.
The survey found the business outlook about the strength of the Australian economy remains weak.
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