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Why MNI
MNI is the leading provider
of intelligence and analysis on the Global Fixed Income, Foreign Exchange and Energy markets. We use an innovative combination of real-time analysis, deep fundamental research and journalism to provide unique and actionable insights for traders and investors. Our "All signal, no noise" approach drives an intelligence service that is succinct and timely, which is highly regarded by our time constrained client base.Our Head Office is in London with offices in Chicago, Washington and Beijing, as well as an on the ground presence in other major financial centres across the world.
AUSTRALIA DATA
Total capital expenditure for Q2 was weaker than expected falling 0.3% q/q and is trending down, but the breakdown showed resilience in machinery & equipment expenditure (+2.1% q/q). The decline in the total was driven by building & structures, which was down 2.5% q/q – the second consecutive fall.
- Investment intentions for the current financial year rose by 11.7% after 12.3% in the last estimate. This is a positive for the Australian investment and growth outlook. It was 8.9% higher for investment in buildings & structures and 15.9% higher in machinery & equipment, continuing the trends in the actual expenditure data.
- The mining sector expects to increase capital spending by 5.9%, lower than non-mining.
- This data feeds into the national accounts and total capital expenditure has a good correlation with total gross fixed capital formation in GDP and machinery & equipment has a very high correlation with the private sector equivalent. But some caution is needed when interpreting the impact of this release on GDP, as Q1 has now been revised up from -0.3%q/q to +0.4%q/q to be more in line with the national accounts.
- The state breakdown actually shows a better investment picture than the headline, with 5 of the 8 states and territories posting increases (including NSW & Victoria).
Australia: Real capital expenditure y/y%
Source: MNI - Market News, ABS
Why MNI
MNI is the leading provider
of intelligence and analysis on the Global Fixed Income, Foreign Exchange and Energy markets. We use an innovative combination of real-time analysis, deep fundamental research and journalism to provide unique and actionable insights for traders and investors. Our "All signal, no noise" approach drives an intelligence service that is succinct and timely, which is highly regarded by our time constrained client base.Our Head Office is in London with offices in Chicago, Washington and Beijing, as well as an on the ground presence in other major financial centres across the world.
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