Australian Business Investment Rises in 1Q

By James Glynn Features Dow Jones Newswires

Australian firms raised investment spending by 0.3% in the first quarter from the last three months of last year, helped by increased activity in mining, the Australian Bureau of Statistics said Thursday.

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Economists surveyed had on average expected a rise of 0.5% in investment for the quarter.

In the year through March, total new capital expenditure fell by 9.3%, the ABS added.

Firms estimated they would invest 6.4% less in 2017-18, compared with an equivalent estimate a year ago. The government data also showed that companies expect to invest 11.4% less in the current 2016-17 fiscal year than an equivalent estimate a year ago.

A sharp drop in mining investment, which has been a major headwind to growth of the Australian economy for a number of years, is easing. The data showed mining investment rose by 0.4% in the first quarter.

But the improved outlook for mining comes as a building construction boom has started to cool, while consumer spending has softened amid record low wages growth.

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GDP growth data for the first quarter will be published next week, with some economists forecasting a flat result.

-Write to James Glynn at james.glynn@wsj.com

(END) Dow Jones Newswires

May 31, 2017 21:54 ET (01:54 GMT)