Maybe, just maybe there is a feeling that the economy has finally turned the corner and maybe the Survive till 25 won’t be in vain!

There definitely seems to be the start of a vibe out there – even if still a bit muted. The most obvious sign and probably also the initial instigator of the vibe was the Reserve Banks announcement of the first reduction in the Official cash rate to 5.25 per cent, which came a few months earlier than most were expecting. The fact that they also projected several more reductions in the short to medium term was positive, even if the expected increase in unemployment (which is currently around historic lows) was less so.

The drop seems to be already flowing into increased interest in the housing market and a slight improvement in confidence levels. All this helps business as consumers will feel less need to keep cash for a rainy day if they can see inflation easing and future reductions in their mortgage interest rates. Hopefully this will flow through to business areas that are currently under the pump, especially in the hospitality and travel areas.

The ANZ Business confidence survey saw a 23-point improvement in August to +51 which is up from +27 in July and from +6 in June. Firms reported expecting their future activity to improve up to +37 – a seven year high whilst current own activity was still at -21, although the bank did comment in July that some of the increase in confidence has a “well it can’t get any worse” vibe.

So maybe it should be “Vibe to 25” rather than “Survive to 25”!