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Economic Statistics: Australia Capex mixed; Building Permits rise

Posted by Akhilesh Ganti on May 29, 2013 10:15:00 PM

Australia capex 1Q2013

Australia first quarter private capital expenditure [Capex] (chart on left) declined by 4.7% -vs- estimates of an increase of +0.5%. The building permits data, which was released simultaneously (chart below), increased by +9.1% -vs- market expectations of +4.0%. AUD/USD spiked lower to 0.9582 (chart on right) AUD capex permits tick052913on the headline Capex number before stabilizing and heading higher after traders saw that Australian companies actually expect to spend AUD 156.5 billion in 2013-2014 which is 3% higher than their last forecast. Australian mining investment in 2013-14 is projected at AUD 101.9 billion, compared with AUD 99.2 billion three months earlier. This, coupled with the rise in permits, saw the Aussie ratchet higher as it broke through the overnight highs at 0.9669 and took aim at the 0.9680 resistance level. A break of this would target key resistance at 0.9710 which, if broken, might signal that a near term corrective bottom is in place. At this juncture, the market is pricing in an 18% chance that the RBA will cut its benchmark rate to a new record low of 2.5% when they meet next week.

{charts:Bloomberg}(click to enlarge)

Australia buildingapprovals apr2013


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