The Westpac-Australian Chamber of Commerce and Industry index of industrial trends hit 34.0 points in the March quarter, down from 40.4 in the fourth quarter of 2008, to hit its lowest level since 1991.

An accompanying measure of business confidence edged up slightly from 33.8 to 34.0, but was still around 1990 levels, when Australia last experienced an economic slowdown.

'The outlook of the March quarter survey remains pessimistic and indicates a further deceleration of domestic activity and a weakening in export performance,' said the ACCI's Greg Evans.

Investment plans plunged to their lowest ebb since 1982, while the survey's index of the labour market slumped 17 points to 33, indicating a rapid deterioration in employment growth.

Australia recorded its first quarter of negative growth in eight years in the final three months of 2008.

Most economists predict a similar result in the current quarter, which would officially put Australia in recession, usually defined as two successive quarters of negative growth. -- AFP