Treasurer Michael Ferguson said the report showed Tasmania was maintaining its strong business confidence, and rated as the highest in the nation and more than double the next best performing state.

"It also shows a significantly increased business conditions rating to the second highest in the nation, an improvement of more than double the December 2022 rating," Mr Ferguson said.

READ MORE: Dead man drinking Jim Beam while driving before crash that killed him: Coroner

"This report comes off the back of recent ABS data that shows Tasmania having a record high participation rate of 62.7 per cent, Job Vacancies 112.3 per cent higher than before the pandemic, and a record low unemployment of 3.8 per cent - 3.6 percentage points lower than what it was in 2014," he said.

Mr Ferguson said the state government had been focusing on economic management which encouraged business growth.

"The NAB report also echoes the CommSec State of the States Report that ranked Tasmania as the second best performing economy in the nation, having improved on all eight performance indicators since we came to government in 2014.

READ MORE: Sweet, new sour brew in time for Valentine's Day

"As the data shows, a strong business sector means more jobs for Tasmanians. Our plan for Tasmania will continue to see our State breaking records as we continue to strengthen our local businesses, employ Tasmanians, and deliver on our plan to secure Tasmania's future," he said.

Business conditions picked back up in January after three months of easing in late 2022 - returning to a very high level at +18 index points. The rise was led by very strong trading conditions in the month, but both profitability and employment are also well above average

NAB Chief Economist Alan Oster said confidence rose strongly in SA, WA, Tas and Vic and was now positive in trend terms.

READ MORE: Community urged to support Ukraine on invasion anniversary

"The improvement in confidence suggest firms have a more optimistic outlook as concerns about global growth prospects ease, while strong conditions are also providing evidence that the economy is more resilient than previously expected," Mr Oster said.

The pace of ongoing supply chain healing and strength of wage growth will be important in shaping how much further cost pressures ease."

Our journalists work hard to provide local, up-to-date news to the community. This is how you can continue to access our trusted content: