Australia's decade-long boom in mining investment is not slowing nearly as quickly as many feared, while other sectors are beefing up spending at a rate that should greatly ease concerns about the economic outlook.
A closely-watched report from the Australian Bureau of Statistics out on Thursday showed businesses had upgraded their spending plans for 2013/14 well above expectations, with even once-laggard industries grasping the spending nettle.
That will be a huge relief to the Reserve Bank of Australia (RBA) which has been betting the farm on investment spreading outside of just mining.
"It's consistent with other sectors starting to take over as drivers of the economy as the mining sector slows," said Shane Oliver, chief economist at AMP Capital Investors.
"In a year's time, we're probably looking at growth heading back to around 3 percent, which is more optimistic that what the RBA was expressing," he added. "Ultimately, it would also be consistent with it leaving rates on hold ahead of a possible rate hike sometime around September or October next year."
Source: Reuters
