Responses to the Australian capital expenditure data are coming in

I posted earlier on the data and the AUD response:

This now via Westpac, in summary, bolding mine:

December quarter Private business capex spending slipped

  • led lower by the mining sector
  • fell short of expectations

By asset,

  • Equipment 2.2%, exceeding our forecast of 1.0%.
  • Building & structures declined by 2.1%, weaker than our expected +0.6%

By industry:

  • mining -4.7%;
  • services +1.7%;
  • and manufacturing +2.6%.

The mining investment wind-down resumed following some resilience over recent quarters

Investment across the non-mining economy moved higher, with a focus on construction.

Our forecast for Q4 GDP has been rounded down to 0.5%qtr, 2.5%yr, moderated from a 0.6%qtr.

2017/18 capex plans Est 5

  • 2.5% above Est 5 a year ago
  • a slight upgrade on Est 4, which was 1.6% above Est 4 a year ago
  • The upward revision was concentrated in mining

For the 2017/18 year, mining capex will decline by around 8%, -$3.4bn.

  • This is more than offset by an 8%, +$6.2bn, rise in non-mining capex

2018/19 capex plan Est 1

  • 3.5% above Est 1 a year ago
  • This is the first positive Est 1 on Est 1 comparison since 2012/13
  • Mining capex is down
  • lift in non-mining

In short, the survey confirms that business investment turned the corner in 2017/18 and will move higher in 2018/19, with a focus on construction activity consistent with the strong upswing in non-residential building approvals