Flash: We look for a total CapEx decline of 1.5% from Australia- NAB

FXstreet.com (Barcelona) - According to the analyst team at NAB Global Markets, “as a prelude to business investment in the March quarter this week we’ll get Construction Work Done (Wednesday) and New Private Capital Expenditure (CapEx, Thursday). For Construction Work Done, we expect Q1 to be flat, just below the market consensus of +1%. It’s an amalgam of whais likely to show some rise in residential fixed investment, lacklustre non-residential building investment, engineering construction (likely still high) and public investment mostly soft. The engineering construction line will be an important barometer of major resource project spending.”

NAB went on to comment, "for total CapEx in the quarter, we look for a total decline of 1.5% against market expectations of a small rise (+0.5%). Investment by nature is very lumpy with spend a function of logistics, weather, project development and no doubt other considerations from one quarter to the next.”

“Behind our thinking lies some apprehension on business spending from the trend decline in business conditions and brittle confidence, even though cost overruns still in some parts of the resource sector have continued. But a consistent theme from mining service companies, second tier miners, explorers and the like has been one of a marked slowdown in activity, evident now since the first half of last year. Large resource companies have been actively bearing down on costs ancutting back sharply on any discretionary spending,” NAB concluded.