The lower Australian dollar doesn't appear to be inspiring much confidence with businesses remaining gloomy about the level of the currency, despite it having hit a six-year low.
Business confidence fell to zero in the March quarter while business conditions slid from five to two points, according to National Australia Bank's quarterly business survey on Thursday.
The figures contradict NAB's monthly business survey for March, released last week, which showed confidence and conditions surged in the month.
The discrepancy could be due to timing, NAB chief economist Alan Oster says, with the monthly survey taken more recently than the quarterly one.
But there's no real answer as to why businesses aren't happier than they were last year about the current level of the Australian dollar, given how dramatically it fell over the March quarter, hitting a six-year low of 75.61 US cents.
The report says more than 30 per cent of non-farm businesses reported an adverse impact from the Australian dollar.
The retail, wholesale and transport and utilities sectors said they were more negatively affected by the Australian dollar than six months previously, when the currency was higher.
"We don't know and we were a bit surprised, because the currency went down. You would've thought that a lower currency would have meant they were happier," Mr Oster says.
"It could be that they were hoping things would be even better, or they thought the currency was going to fall further."
The report continues to suggest a "patchwork economy" with only service sectors recording positive business conditions in the quarter.
Falling commodity prices were weighing on mining businesses while manufacturing and wholesale appeared to be receiving "very little support from a more favourable Australian dollar".
"A lower Australian dollar and oil prices, plus the RBA's (Reserve Bank of Australia) rate cut in February, seemingly did little to boost confidence in the first quarter," the report said.
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