Gross company operating profits rose by 1.7% in QIV which was a little weaker than market expectations which centred ona 2.0% increase (CBA (f): 3.0%)). Profits are now 10.7% higher over the year which is the highest annual growth rate sinceDecember 2010. Nominal GDP growth is picking up slowly, after a falling terms of trade resulted in weak income growthover 2012-13. Nominal outcomes are important because we all live in the nominal economy. It is our experience with theprices we pay and the wages we earn. Businesses will benefit from rising revenues because it encourages labour hiringand capital expenditure.
Read the full report: Economic Research
Commonwealth Bank