Back
29 Aug 2013
Flash: RBA to keep an eye on capex - Westpac
FXstreet.com (Barcelona) - While there is still very little chance of another rate cut next week, the RBA will be paying close attention to Australia’s capital expenditure data today, notes Sean Callow, FX Strategist at Westpac.
Key Quotes
"The initial AUD response will be to the Q2 actual capex, which we see remaining soft, -1% q/q after Q1’s -4.7% but with the median forecast 0.0%. In the breakdown, we expect plant & equipment spending about flat but building & structures -2% on further unwinding of the boom in mining investment. The P&E component is most important for Q2 GDP due Wed, with our current forecast 0.6% q/q, 2.6% y/y."
"The survey of investment plans for 2013/14 will be more important for the RBA. We will see the third estimate of plans, with A$179bn implying sustained optimism (the 2nd estimate was unexpectedly upbeat) but more likely a number near $169bn. A reading closer to $160bn would be notably weak and would increase the chances of a rate cut in Oct."
Key Quotes
"The initial AUD response will be to the Q2 actual capex, which we see remaining soft, -1% q/q after Q1’s -4.7% but with the median forecast 0.0%. In the breakdown, we expect plant & equipment spending about flat but building & structures -2% on further unwinding of the boom in mining investment. The P&E component is most important for Q2 GDP due Wed, with our current forecast 0.6% q/q, 2.6% y/y."
"The survey of investment plans for 2013/14 will be more important for the RBA. We will see the third estimate of plans, with A$179bn implying sustained optimism (the 2nd estimate was unexpectedly upbeat) but more likely a number near $169bn. A reading closer to $160bn would be notably weak and would increase the chances of a rate cut in Oct."