Roy Morgan Business Confidence virtually unchanged in February at 108.5 as Reserve Bank cuts interest rates
In February 2025, Roy Morgan Business Confidence was virtually unchanged at 108.5 (up 0.3pts from January 2025) as the Reserve Bank decided to cut interest rates for the first time in over four years in mid-February by +0.25% to 4.1%.
Following the increase in February Roy Morgan Business Confidence has now had a positive rating above 105 for five months in a row – the first time this has happened since July 2021 during the middle of the COVID-19 pandemic spending binge.
Businesses are generally confident about the year ahead with a large majority of 61.8% (up 3.2ppts) expecting ‘good times’ for the Australian economy for the year ahead compared to just over a third, 35.1% (down 0.7ppts), that expect ‘bad times’.
This confidence about the broader economy translates across to prospects for businesses themselves with 44.8% (up 1.1ppts) expecting their own business to be ‘better off’ financially this time next year compared to only 16.4% (up 1.3ppts) expecting to be ‘worse off’.
Businesses are also looking to invest in growing the business with 43.7% (up 0.5ppts) that say the next 12 months is a ‘good time to invest’ in growing the business compared to 34.7% (down 0.5ppts) that say the next 12 months is a ‘bad time to invest’.
Business Confidence is just 1.8pts below the long-term average of 110.3, but a large 21.6pts higher than the latest ANZ-Roy Morgan Consumer Confidence of 86.9 for March 3-9, 2025.
Roy Morgan Monthly Business Confidence - Australia
Source: Roy Morgan Business Single Source, Dec 2010-Feb 2025. Average monthly sample over the last 12 months = 1,581.
Business Confidence is up from a year ago driven by New South Wales and Queensland
Business Confidence for the month of February was up just 0.3pts on a month ago, but up a more significant 7pts from February 2024. The increase in Business Confidence has been driven by significant increases in Queensland, New South Wales, and Western Australia.
The most significant increases were in Queensland, up 13.5pts from a year ago to 108.2, and in New South Wales, up 13pts to 108.5 and both are in line with the national figure of 108.5.
There were also strong increases in Tasmania, up a stunning 27.3pts from a year ago to 115.5 and in Western Australia, up 9.7pts to 112.4. Western Australia faced a State Election over the weekend which saw a resounding re-election victory for the ALP Government led by Premier Roger Cook.
Business Confidence was highest in South Australia at 118.0, up 1pt from a year ago, and nearly 10pts above the national figure. The only exception to rising Business Confidence was in Victoria with Business Confidence down 6.7pts on a year ago to 101.4 and now the lowest of any State.
Business Confidence by State in February 2024 vs February 2025
Source: Roy Morgan Business Single Source, February 2024, n=1,560, February 2025, n=1,481. Base: Australian businesses. *Tasmanian Business Confidence is measured over two months: January and February 2024 cf. January and February 2025.
Mining, Financial & Insurance Services, Public Administration & Safety and Education & Training are the four most confident industries during January and February 2025
Over the last two months there were 15 industries with Business Confidence in positive territory above the neutral level of 100 led by Mining, Financial & Insurance Services, Public Administration & Safety, Education & Training and Information, Media & Telecommunications filling out the top five industries.
There were four industries with confidence over 15pts above the average in January and February 2025 led by Mining on 132.6, up 26.9pts on a year ago ahead of Financial & Insurance Services on 128.7 and up 31pts.
Filling out the top four are Public Administration & Safety on 127.5, up 19.3pts on a year ago, and Education & Training on 125.6, up 10.2pts. Education & Training has now been amongst the top five most confident industries for nearly three years since June 2022.
The least confident industry is Wholesale trade on only 85.2, and down 16.3pts from a year ago, just below Agriculture, Forestry & Fishing on only 86.0, and also the industry with the lowest average Business Confidence over the last two years of only 81.9. The industry with the third lowest Business Confidence is Electricity, gas, water & waste services on 90 and the lowest average Business Confidence since the beginning of 2022 of only 84.7.
Business Confidence for Top 5 and Bottom 5 Industries in January & February 2025
Source: Roy Morgan Business Single Source, January & February 2025, n=3,075. Base: Australian businesses.
Note: In the chart above, green bars represent Business Confidence in positive territory above the national average, red bars represent Business Confidence well below the national average and below the neutral level of 100 while the dark blue bar represents Business Confidence above the neutral level of 100 but still below the national average.
Business Confidence was virtually unchanged at 108.5 in February with three indices in positive territory all related to prospects for the business and Australian economy over the next year:
- In February, under a third of businesses, 31% (down 0.9ppts), said their business is ‘better off’ financially than this time a year ago, while 31.9% (up 0.8ppts), said the business is ‘worse off’;
- Businesses’ views on their prospects for the next year were virtually unchanged in February with 44.8% (up 1.1ppts) expecting the business will be ‘better off’ financially this time next year, while only 16.4% (up 1.3ppts), expect the business will be ‘worse off’;
- Confidence regarding the performance of the Australian economy over the next year improved in February with a clear majority of 61.6% (up 3ppts), expecting ‘good times’ (the highest figure for this indicator for three years since February 2022) while only 35.1% (down 0.7ppts) expect ‘bad times’ (the lowest figure for this indicator for three years since February 2022);
- In addition, businesses’ views on the long-term future of the Australian economy over the next five years were down slightly with 34% (down 0.5ppts) expecting ‘good times’ over the next five years compared to a majority of 54.7% (up 1ppt) expecting ‘bad times’;
- Net sentiment on whether now is a ‘good or bad time to invest in growing the business’improved in February with 43.7% (up 0.5ppts) saying the next 12 months will be a ‘good time to invest’ in growing the business and 34.7% (down 0.5ppts) who say the next 12 months will be a ‘bad time to invest’ (the lowest figure for this indicator for nearly four years since June 2021).
Michele Levine, CEO of Roy Morgan, says Business Confidence was virtually unchanged in February at 108.5, a fifth straight month well into positive territory above 105 – the first time this has happened for nearly four years since mid-2021 during the pandemic:
“Roy Morgan Business Confidence was virtually unchanged at 108.5 in February and is now at its highest since the election of the incumbent Albanese Government in May 2022.
“Businesses are confident with an increasing share of businesses, 44.8% (up 1ppt), now saying they will be ‘better off’ financially this time next year and a growing majority of 61.8% (up 3ppts) that say they expect ‘good times’ for the Australian economy over the next year – the highest since February 2022.
“Although the Reserve Bank’s decision to cut interest rates in late February by +0.25% to 4.1% has not yet had a significant impact on Business Confidence, the prospect of further interest rate cuts in the months ahead is clearly providing a confidence boost to many businesses.
“Importantly, all three of the Business Confidence indicators that look at views on the next year relating to the businesses’ finances, the broader Australian economy, and the general investment climate, are all clearly in positive territory.
“On a State-by-State basis Business Confidence is in positive territory in all six States led for a second straight month by the two smallest States of South Australia (118.0) and Tasmania (115.5). Business Confidence is also riding high in Western Australia (112.4) – which turned out to be a good omen for Premier Roger Cook’s Labor Government which was re-elected in a landslide win over the weekend.
“At an industry level, it is Mining which is clearly the most confident industry on 132.6 ahead of Financial & Insurance Services on 128.7, Public Administration & Safety on 127.5 and Education & Training on 125.2. Education & Training has now been amongst the top five most confident industries for nearly three years since June 2022.
“At the other end of the scale is Wholesale Trade on only 85.2 just below Agriculture, Forestry & Fishing on 86.0 and the lowest average Business Confidence over the last two years of only 81.9. The industry with the third lowest Business Confidence is Electricity, gas, water & waste services on 90 and the lowest average Business Confidence since the beginning of 2022 of only 84.7.”
The latest Roy Morgan Business Confidence results for December are based on 1,481 detailed interviews with a cross-section of Australian businesses from each State and Territory. Detailed findings are available to purchase on a monthly or annual subscription as part of the Roy Morgan Business Confidence Report.
For comments or more information please contact:
Michele Levine
CEO, Roy Morgan
Office: +61 (3) 9224 5215
Mobile: 0411 129 093
To learn more about Roy Morgan’s Business Confidence, Consumer Confidence and Inflation Expectations data call (+61) (3) 9224 5309 or email askroymorgan@roymorgan.com.
About Roy Morgan
Roy Morgan is Australia’s largest independent Australian research company, with offices in each state, as well as in the U.S. and U.K. A full-service research organisation, Roy Morgan has over 80 years’ experience collecting objective, independent information on consumers.
Margin of Error
The margin of error to be allowed for in any estimate depends mainly on the number of interviews on which it is based. Margin of error gives indications of the likely range within which estimates would be 95% likely to fall, expressed as the number of percentage points above or below the actual estimate. Allowance for design effects (such as stratification and weighting) should be made as appropriate.
| Sample Size | Percentage Estimate |
| 40% – 60% | 25% or 75% | 10% or 90% | 5% or 95% | |
| 1,000 | ±3.0 | ±2.7 | ±1.9 | ±1.3 |
| 5,000 | ±1.4 | ±1.2 | ±0.8 | ±0.6 |
| 7,500 | ±1.1 | ±1.0 | ±0.7 | ±0.5 |
| 10,000 | ±1.0 | ±0.9 | ±0.6 | ±0.4 |
| 20,000 | ±0.7 | ±0.6 | ±0.4 | ±0.3 |
| 50,000 | ±0.4 | ±0.4 | ±0.3 | ±0.2 |
