Australia business confidence jumps in Q3-survey

SYDNEY, Oct 27 (Reuters) - A measure of Australian business confidence jumped to its highest in more than seven years in the July-September quarter, while business conditions improved due to rising sales and profits.

The quarterly National Australia Bank (NAB.AX) (NAB) survey's measure of business confidence rose 20 points to +16 points while business conditions rose 14 points to +3.

"New data in this survey point to a significant jump in both near and long term business expectations," said Alan Oster, chief economist at NAB. "Longer term expectations, in particular, are returning to around long run average levels."

Business confidence and conditions have improved in the past few months, helped by a pick up in global activity and robust demand from China, Australia' biggest trading partner.

NAB's monthly survey of business confidence for September, released earlier in October, showed a dip but also a resilient labour market.

The latest quarterly survey showed forward orders improved, consistent with strong demand, while the availability of labour tightened but was still at historically very low levels.

Wage pressures remained subdued as purchase costs and economy wide price pressures slowed.

The government will release third-quarter consumer price index numbers on Wednesday. The numbers have assumed significance after recent Reserve Bank of Australia (RBA) commentary turned towards fighting inflation from supporting growth.

Analysts are expecting the core inflation rate to rise 0.8 percent in the third quarter, leaving it 3.5 percent higher from a year earlier. [AU/ECI]

That would still keep the rate above the central bank's target range of 2-3 percent range. A higher figure could add to expectations that the Reserve Bank of Australia will opt for a 50 basis point hike next month.

The NAB survey also showed retail inflation was showing signs of slower growth, reflecting a higher Australian dollar AUD=, which rose more than 9 percent last quarter. (Reporting by Anirban Nag; Editing by Jonathan Standing)