Weakness in Australia's capex spending evident across number of fronts

In Australia, the actual spending in Q3 2015 and fourth estimate of spending plans for 2015/16 were released in the ABS survey of private business CAPEX. In the September quarter, the spending declined by 9.2%, way ahead of the expectations of 2.9% decline by market consensus.

There were some insights provided by the Capex spending by state. There were slumps seen in mining states Qld and WA. There was a sharp fall of 14% in NSW, which accounted for 30% decline in the whole capex for Q3.

This weakness in NSW capex was evident in service sectors, as there would be turndown in the non-residential building cycle.

"Capex plans for 2015/16 were upgraded from those of 3 months ago. However, as anticipated, the upgrade was modest and capex plans remain weak dominated by the downturn in mining investment", says Westpac in a research note.