Having seen construction work completed disappoint on Wednesday, the latest of Australia’s GDP inputs arrives this morning with the release of business capital expenditure (CAPEX) figures for the March quarter.
Here’s the state of play.
- The most important part of today’s release will be the second estimate of 2015/16 expected expenditure.
- The first estimate for the 2015/16 financial year was $109.799 billion. This was down 12.4% on the first estimate made for expenditure in 2014/15.
- Based on historic data, on average, the second estimate is 7.8% higher than that offered in the first estimate.
- Aside from looking for an upward revision, markets, along with the RBA, will be watching the breakdown of the second estimate extremely closely.
- In the first estimate, expected expenditure across manufacturing and ‘other’ industries totaled $49.566 billion. That for mining came in at $60.233 billion.
- To allay fears of a steeper-than-expected slowdown in Australian economic growth, a reasonable increase in the estimate for non-mining expenditure will be required.
- For the March quarter business capex is expected to fall 2.4% following a 2.2% decline in Q4 2014.
- Equipment, plant and machinery spending, a direct GDP input, is expected to contract by a further 1.2%.
Business Insider will have full coverage of the CAPEX report once it is released at 11.30am in Sydney.