Rates, funding access hits business

by BN06 Dec 2011

Interest rates are still top of mind for business clients despite the Melbourne Day cash rate cut, while they expect access to finance to be one of their primary challenges next year.

Dun & Bradstreet's latest Business Expectations Survey has found that a third of all business executives surveyed still cite interest rates as their biggest concern heading into 2012.

This comes despite a cash rate decrease of a quarter of a percentage point on Melbourne Cup day, which brokers have said has not filtered through to significantly help business clients.

An increasing number of firms (14%) have argued that access to finance is increasingly affecting their business. As a result, the proportion of firms citing a shortage of funding as the biggest barrier to growing their business has nearly doubled since the middle of this year.

Dun & Bradstreet CEO Christine Christian said the issue of contagion from the escalating situation in Europe is affecting business confidence in Australia, with overall confidence down this month.

"The sudden drop in business sentiment over the course of the last month following fairly solid results in October indicates the degree of volatility that is being felt in the marketplace," she said.

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