Some of the points noted by Westpac on Australia’s Q2 Capex released earlier.
- In contrast to the headline, the detail is arguably weak
- Equipment spend fell by 1.2%, while we had expected a slight rise, of +0.5%.
- Building & structures spend jumped 7.1%, following falls in the past three quarters.
- By industry, mining +6.4%, services +2.4% and manufacturing -8.9%
- Westpac’s forecast for Q2 GDP remains 0.6% qtr, 2.6% yr
2013/14 CAPEX plans in at $159.2bn
- 4% below spending in 2012/13, that is a weak result and far less positive than the 2nd Estimate, published three months ago, which implied growth of 8%
- Downgrades were evident across each of the three broad industry groupings
- The CAPEX survey is in “line with our reading of the economy. Mining investment has peaked, services sectors are on hold and manufacturing are cutting investment”
