A senior equities research analyst says business confidence is unlikely to bounce back quickly after the federal election as cautious business leaders wait to assess any changes in government policy.
Deutsche Bank analyst Mark Wilson said major Australian corporations he had spoken to were tending to hold back investment because of the impending federal election, due on September 7.
"What has been extraordinary over the last six months is that almost every company I've talked to raised the election as a big issue and an impediment to investing," Mr Wilson told journalists at a briefing in Sydney.
Boards and senior management alike were reluctant to commit to new investment until they were more sure of what will occur after the election, despite the growing certainty of a coalition win.
"As we draw closer to the election that certainty should be increasing but their tone certainly hasn't changed," Mr Wilson said.
"So it will be a test for them as we get into October-November, as to whether they as companies are prepared to spend more because they've certainly been withdrawing funds given that general uncertainty as to the direction of policy.
"My view is that it's not going to be instantaneous from a corporate perspective, that it is going to be a calendar 2014 story."
