Businesses confidence is still high, helped by subdued cost pressures and better consumer confidence.
The NAB business confidence index in August fell two points to eight points, after hitting a one-year high in July.
A reading above zero indicates optimists outweigh pessimists.
NAB chief economist, Alan Oster, said a small slide in confidence was inevitable after the record high in July.
“Retail confidence remains positive, but fell sharply from last month consistent with our reservations over the optimism in July,” he said on Tuesday.
“In August, mining, wholesale, and transport and utilities were all negative.”
NAB’s business conditions index fell to four points in August after it hit a four and a half year high of eight points in July.
Oster said business conditions are higher than they were in 2013 but still below pre-global financial crisis levels.
“In large part, the decline in business conditions during the month reflects an unwinding of some of the narrowly based gains seen in July,” he said.
“This was particularly stark in manufacturing, which dropped 13 points, following an 18 point improvement in July.”
Oster said the trend in business conditions still looks reasonably positive.
NAB still predicts there will be no movement in the Reserve Bank of Australia’s cash rate until late 2015.