Business spending dips, but outlook on the up
Business investment slumped by a worse-than-expected 2.8 per cent during the December quarter, though Australian companies appear to have bolstered their spending plans.
Business investment slumped by a worse-than-expected 2.8 per cent during the December quarter. (Photo: Steven Saphore/AAP PHOTOS)
The seasonally adjusted $28.45 billion in total new capital expenditure was the lowest in two years and missed consensus expectations of a 0.5 per cent gain for the quarter.
Building and structures capex fell 5.9 per cent in the December quarter while mining capex fell 2.7 per cent.
The figures follow a disappointing 0.2 per cent fall in the September quarter, with capex set to be a drag on next week’s GDP print.
However, the Australian Bureau of Statistics’ latest spending estimate for the 2019/20 year came in at $120.3 billion, 2.1 per cent higher than the same estimate a year ago.
The first estimate for 2020/21 is also up on last year, 8.8 per cent higher at $100.2 billion.
This figure is fuelled by an expected 28 per cent increase in mining spend to $38.5 billion for the year, and a 10.8 per cent expected increase in buildings and structures to $61 billion.
The Australian dollar fluctuated slightly on the release of the data but had eased back to 65.51 US cents by 1155 AEDT.
– AAP
