Australia’s construction sector has, with the exception of units, been disappointingly weak across most of the past year. The trend weakening in 2014 continued in 2015.
So, analysts were forecasting another negative print of -1.5% when the ABS reported Q2 construction work done this morning.
But, in a big surprise, and a pointer to the possibility tomorrow’s CAPEX numbers might be stronger than forecast, the ABS reported that during the three months ending June 30 “The seasonally adjusted estimate for total construction work done rose 1.6% to $49,811.6m.”
Building work fell 2.6% to $23,313.6 million seasonally adjusted but Engineering work done rose 5.6% during the quarter to $26.497.9 million the ABS said.
As the chart shows, residential is a huge driver of this result.
Overall that data shows a big improvement in the rate of decline from a year ago which rose from -8% in the 12 months to the end of the March quarter to a more benign, but still significant, -3.3% in the 12 months to June 2015.