By James Glynn
SYDNEY–Australian business investment in the first quarter was weaker than expected, casting doubt over the pace of economic growth at the start of the year.
Business investment fell 0.3% in the first quarter from the fourth quarter, the Australian Bureau of Statistics said Thursday.
Economists had expected business investment to rise 1.5% on quarter. Investment in buildings and structures fell 1.7%, while equipment, plant and machinery investment rose 1.2%, the ABS said.
Still, the outlook remained strong, with companies expecting investment of 130 billion Australian dollars (US$92.13 billion) in the year to June 30, 2023, up 11.8% from an initial estimate, the ABS said.
The softness in investment might be attributable partly to business uncertainty ahead of a federal election in May, while labor shortages and global supply bottlenecks are also stretching out build times for construction projects.
Business fixed investment was broadly flat both in the first quarter and over the past year, said Kieran Davies, chief macro strategist at Coolabah Capital.
“This points to a poor outcome for first quarter GDP next week unless there is a big run-up in inventories and or a surge in public spending,” Mr. Davis said.
Write to James Glynn at firstname.lastname@example.org