Data is here: Australia - Construction Work Done (Q2): -3.7% (expected -2.0%)
ANZ say the steep drop in engineering construction suggests the mining sector is at its peak drag on GDP:
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WPAC's take:
- Construction work is trending lower, led ... by the mining investment downturn.
- The sector accounting for 13% of the economy this is a material headwind
- Over the past year, construction activity is down by 10.6%
- The June quarter outcome will subtract in the order of 0.3ppts to 0.4ppts off quarterly GDP
- New home building activity was flat in the period, whereas we had anticipated a modest gain
- Going forward, there is still some further upside to home building, although the period of strong growth is behind us
- The private non-residential building cycle has turned down in 2016
- Public works advanced for a fourth consecutive quarter
- State governments are committing to additional investment, including public transport projects.
