Westpac write "over the second half of....>

AUSTRALIA: Westpac write "over the second half of 2018, construction activity

was much weaker than anticipated. This poses a downside risk to our forecast for

Q4 GDP, which is currently 0.5%qtr, 2.7%yr. It does help to explain the loss of

momentum in business conditions evident in the private business surveys. A key

dynamic is that the new home building cycle has turned. Strong gains in Q1 and

Q2, +4.3% and 4.0%, have been followed by sizeable falls in Q3 and Q4, -2.5% and

-3.6%. The slump in dwelling approvals over the second half of 2018, following a

strong run, points to the downswing being a significant drag on growth during

2019 and in to 2020. Public infrastructure activity is the surprise - with a

quarterly profile during 2018 of: +6.7%, +1.1%, -2.6%, and -10.3%. Possibly

bottlenecks is a constraint or it may have been weather disruptions. Given the

sizeable amount of work yet to be done and with new projects being add to the

investment pipeline we expect public works to add to activity in 2019. Tomorrow

we receive an update on business investment, with the capex survey, ahead of the

national accounts on Wednesday March 6."