Capex disappoints

The ABS quarterly capex report was out today and disappointed on current spend as well as expected spend outside of mining. First, the details from the quarter past:

Trend estimates(a)
Total new capital expenditure
38 737
Buildings and structures
22 692
Equipment, plant and machinery
15 916
Seasonally adjusted(a)
Total new capital expenditure
37 915
Buildings and structures
22 243
Equipment, plant and machinery
15 672

The important figure is the 0.3% fall, versus market expectations of a 4% rise.

The total estimated capex for the first quarter of 2012/13 showed a very healthy rise to $173 billion (remember the clear bars are the expected capex for the year in any given quarter, the shaded areas are the actual):

But the composition was very much more of the two speed economy. Mining continues to power with its first estimate for 2012/13 of Goliath proportions:

But manufacturing and other industries (basically everything else) is going backwards:

Grab  a hard hat, you’re going to need one.

Houses and Holes

David Llewellyn-Smith is Chief Strategist at the MB Fund and MB Super. David is the founding publisher and editor of MacroBusiness and was the fouding publisher and global economy editor of The Diplomat, the Asia Pacific’s leading geo-politics and economics portal.

He is also a former gold trader and economic commentator at The Sydney Morning Herald, The Age, the ABC and Business Spectator. He is the co-author of The Great Crash of 2008 with Ross Garnaut and was the editor of the second Garnaut Climate Change Review.


  1. Another case of ‘disappointing’ primarily because expert economist forecasts were wrong. Way wrong. Overall, remains an enviable position to be in.

      • ‘Manufacturing’ and ‘Other’ not going gangbusters, but the remainder in positive territory.

        Overall, as the ABS states “Actual expenditure remains strong and expected expenditure at record level”.