Australia's business outlook, according to the latest NAB survey, remains positive despite some pull back in the final quarter of 2015; it also suggests global uncertainties continue to be the greatest risk. NAB official release The NAB Quarterly Business Survey for Q4 2015 provides insight into how the domestic business environment was playing out towards the end of 2015, just prior to the resent rout in financial and commodity markets that have raised concerns over the economic outlook around the world. “The Survey is confirming yet again that despite the issues facing the mining sector, Australia continues to enjoy a relatively healthy, vibrant and adaptive economy”, said NAB Group Chief Economist Alan Oster. However, global market volatilities highlight the growing risks to the outlook. “The longer these market volatilities persist, the more likely we will see an impact via sentiment channels”, said Mr Oster. Prior to the recent market retreat, however, business confidence actually recorded a rebound, lifting 3 points to +4 index points. This in large part is a reflection of business conditions (how firms feel about their own business), which also held up at elevated levels (+9 index points) despite easing back slightly in the quarter. These outcomes are broadly consistent with what has been reported in the monthly NAB Survey, suggesting that the non-mining recovery has remained resilient. According to Mr Oster, “the real insight from this survey is seeing how firms are feeling about the outlook for their business and the economy. It certainly seems like they are remaining quite upbeat about the outlook, which suggests good things for the labour market and future investment.” Leading indicators were relatively positive in Q4 2015. Forward orders remained at quite elevated levels, as did expectations for business conditions in 3 and 12 months’ time. A modest lift in capacity utilisation and capex plans for the next 12 months could be hinting at a much needed lift in non-mining business investment, although high ‘hurdle rates’ of return to investment will remain a challenge, while employment intentions have stayed elevated. Finally, given the cross-winds facing the construction sector from a downturn in mining investment on the one hand, and booming residential construction on the other, this quarter we have broken down the responses from construction firms into residential, non-residential, engineering and services. “Unsurprisingly, engineering tends to lag behind in most indicators, while residential and non-residential building are outperforming”, said Mr Oster. For more information, read our latest forex news.