CANBERRA, AAP – Around three-quarters of Australia’s senior finance executives expect an interest rate rise this year as the economy bounces back from the pandemic.
Chief financial officers surveyed by Deloitte also found almost all (95 per cent) rated uncertainty levels more broadly as being higher than normal – an all-time peak since its biannual CFO sentiment survey began in 2009.
Even so, just over four-in-five CFOs are feeling optimistic or highly optimistic about the financial prospects of their company.
“Australia might be off to a shaky Omicron-induced start to 2022, meaning uncertainty remains a challenge for all of us,” Deloitte partner Stephen Gustafson said.
“But against this backdrop, there’s next to no pessimism around.”
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That said, 93 per cent believe securing and retaining key staff is one of the key risks for business for the next 12 months.
“This was a concern six months ago, but these concerns now dwarf concerns about other risks,” Mr Gustafson said.
Interest rate expectations have also changed dramatically over the past year.
“Almost three-quarters expect rates will rise this year, likely driven by the much better than expected ability of Australia’s economy and jobs to bounce back from pandemic impacts, along with the highest rates of price inflation seen in several years,” he said.
Reserve Bank governor Philip Lowe has warned that an interest rate rise is “plausible” this year, predicting a marked pick-up in inflation compared to his view just a few months ago, and a drop in the unemployment rate below four per cent, a 50-year low.
The jobless rate was 4.2 per cent in December, a 13-year low.
Figures released by the National Skills Commission on Wednesday showed online job advertisements jumped 4.4 per cent in February to 259,000 positions, the highest level since September 2008.
The commission said the level of recruitment activity remains significantly elevated compared to pre-COVID levels, up 54 per cent.
On Thursday the Australian Bureau of Statistics will release its latest payroll job figures for the fortnight ending January 15, a forerunner for the full labour force report for the month due on February 17.
