The NAB business confidence index ticked up 2 points to 7 index points in July, with confidence strongest in construction, as well as the service sectors, and weakest in retail and wholesale, in trend terms, according to a survey by the National Australia Bank (ASX:NAB) published Tuesday.

The NAB business conditions index fell 2 points to 5 index points in July, driven by a softening in trading, profitability, and employment, per the report.

By industry, a rise in conditions in retail, construction, and wholesale was offset by declines across the other industries, led by a fall in transport & utilities. In trend terms, conditions were strongest in mining and the services sectors, but remained weak in retail, wholesale, and manufacturing, the report said.

Capacity utilisation eased back to 82.4% but remains above the long-run average of 81.3%. Forward orders were unchanged at 0 index points.

Purchase cost growth edged up to 1.4% in quarterly equivalent terms while labour cost growth rose to 2.1%. Product price growth rose to 0.9%, while retail prices accelerated to 1.1%, the report added.