With the RBA and Treasury effectively betting the house on a pick up in business investment, the Private Capital Expenditure survey will be vital to see whether the tentative signs of a turn in investment in the non-mining sector has continued in the September quarter and more importantly, continued in the business investment expectations for the next year.
After sharp falls in the decade from 2005 to around 2015, when non-mining investment as a per cent of GDP fell to a record low, there has been a small, but welcome upturn. With consumer demand still weak, a pick up in overall economic growth is relying on business investment to pick up the slack. Certainly the NAB and illion business confidence and business expectations surveys are pointing to strength. The proof will be to see whether this optimism translates to actual fresh investment activity.
