28.05.202005:14:00UTC+00Australia Capital Expenditure Falls Less Than Expected In Q1

Australia's private capital expenditure decreased less than expected in the first quarter, data from the Australian Bureau of Statistics showed Thursday.

Total new capital expenditure fell 1.6 percent sequentially in the first quarter, slower than the 2.6 percent decline in the fourth quarter of 2019. Economists had forecast another 2.6 percent drop in the first quarter.

Investment in buildings and structures dropped 1.1 percent and that in equipment, plant and machinery was down 2.3 percent.

On a yearly basis, total private capital expenditure slid 6.1 percent in the first quarter.

Companies plan to reduce their investment for 2019-20. They expect a total investment of A$115.4 billion, which was 3.8 percent lower than the previous projection.

Likewise, investment for 2020-21 was estimated at A$90.89 billion, down by 8.8 percent from the previous estimate.

Firms' expectations of future capital expenditure point to a sharp downturn in investment in the coming months, Ben Udy, an economist at Capital Economics, said.

According to a survey conducted by the statistical office, Covid-19 has forced 70 percent of Australian businesses to change how they operate.

The survey on Business Impacts of Covid-19 showed that seven in ten businesses had a decrease in revenue as a result of the pandemic.