Australia Q2 capex response: "broadly neutral … industry mix is arguably disappointing"

Westpac's initial analysis of the capital expenditure data out earlier:

• AUD capex data for Q2, headline: -2.5% (expected 0.6%)

This in brief. I'll jump ahead to this bit (looking ahead to Sep 5):

• Our forecast for Q2 GDP remains 0.6%qtr, 2.7%yr. Earlier upside risks to this forecast have been largely negated by the disappointment on equipment spending.

On the capex data (bolding mine):

• Q2, total capex -2.5%, with equipment, -0.9%.2018/19 capex plans: Est 3 $102bn, 1% below Est 3 a yr ago, a broadly neutral update, but the industry mix is arguably disappointing.

In terms of the broad themes, mining investment is set to move lower in 2018/19, while non-mining investment is in an uptrend.

• The remaining gas projects under construction are largely complete, which will see mining capex decline near-term ahead of an emerging stabilisation.
• 3rd estimate of non-mining capex plans is less upbeat
• Our central case forecast … consistent with other indicators such as the sizeable pipeline of non-residential building work yet to be done and the uptrend in infrastructure work (particularly investment in renewables power generation).