A survey has revealed that the Australian economy is becoming increasingly strong even while retailers continue to struggle.

The Dun & Bradstreet business expectations survey shows that although the positive outlook is shared across all sectors, retailers report this is some of their most difficult circumstances for years.

Damian Karmelich, Dun & Bradstreet director of corporate affairs, said the results provide a clear insight into the real strength of the Australian economy as well as the gap that is emerging between retailers and the rest.

"During the Christmas period there has been an understandable focus on the challenges faced by retailers and the survey shows that retailers are preparing to discount in response to those challenges,” he said.

“However, for firms engaged in business-to-business trade and exposed to the growth of emerging economies like China the outlook is positive,

"There is a clear distinction between retailers and the rest in actual performance.  The non-retail sector is driving the economy while retailers struggle with household deleveraging."

According to the survey, the distinction between retailers and the rest is most apparent in sales performance. 

Expectations for sales in the quarter ahead remain positive with a net result of 31, a figure that is well above any quarter in the six years ending June 2004 through to March 2010.

Forty-eight percent of firms anticipate increased sales while 17 per cent believe sales will fall.  The sales expectations of retailers is particularly strong, with the retail sales index at 35, three points above the sales indexes for wholesalers and durables manufacturers.

However, despite these significant expectations for the New Year, retailers are yet to see strong gains in actual sales. This group's index is at 8 for the September quarter 2010, well below the aggregate index of 14.