Dr. Shane Oliver, Head of Investment Strategy and Chief Economist at AMP Capital – Australia’s largest life insurer and huge fund manager, expressed his take on the latest Australian Capex data release and its impact on the country’s growth numbers.
Australian December quarter business investment -2.8% QoQ due to a 5.9% fall in building investment which was consistent with the fall in construction.
Equipment investment was +0.8%, mining -2.7%, manufacturing -10.1% and other -1.9%.
Capex will drag on Dec quarter GDP, which we currently expect to be just +0.3% QoQ.
AUD bulls attempting a bounce
AUD/USD is seen extending the bounce from near a multi-year low of 0.6541, despite the coronavirus fears led risk-off trading in the Asian equities, as the bulls cheer upbeat Australian Capex estimates for 2020/21.
The spot, currently, trades +0.20% at 0.6556, having hit a new daily high at 0.6561 in the last hour.