Australia business conditions steady in February, sentiment slips

SYDNEY, March 10 (Reuters) - A ‌measure of ​Australian ​business conditions held steady in February with sales improving a little, a survey showed on Tuesday, ‌though sentiment turned negative for the first time ⁠in 11 months as borrowing costs rose.

The survey from National Australia Bank ‌showed its index of ‌business conditions held at +7, in line with the long-run average. The survey's often volatile measure of business confidence dropped ​5 points to -1.

A measure of sales edged up 1 point to a relatively firm +12, while profits stayed ⁠at +4 and employment dipped slightly to +3.

"Business confidence is now in negative territory for the ​first time in almost a year, likely reflecting some caution in the wake of the ​February rate hike," said analysts at ‌NAB.

The Reserve Bank of Australia raised interest rates by a quarter point to 3.85% in ⁠February, the first hike in two years, as it struggled to control stubborn inflationary pressures.

The survey showed measures of labour and ⁠input costs both rebounded in February, while quarterly growth in retail prices ​climbed to 1.0% from just 0.3%.

There was better news on investment plans, which rose to the highest level in three years, while ‌forward orders trebled to an index reading of +6 in a positive signal for future demand.

The ‌survey was conducted from February 23 to March 2 and ⁠thus only caught the ‌very beginning of the ​U.S.-Israeli attack on Iran and subsequent spike in energy prices.

(Reporting by Wayne Cole; Editing by Jamie ‌Freed)

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