Australia Q4 Capital Spending Unexpectedly Grows

Total new capital expenditure in Australia fell 3.6% quarter-on-quarter in the second quarter of 2026, reversing an upwardly revised 6.9% increase in the previous quarter and against expectations for no change. That was due to a sharp pullback in expenditure on equipment, plant and machinery, which declined 8.9% after an 18.4% jump in the prior quarter, particularly the 53% plunge in spending on information media and telecommunications equipment following record data-centre investment that drove a 199.6% surge last quarter. In contrast, expenditure on buildings and structures rose 2.1%, rebounding from a 3.3% drop. Regionally, capital spending declined in New South Wales (-2.8%), Victoria (-13.9%), Queensland (-0.4%), and South Australia (-1.9%), while it increased in Western Australia (4.0%), Tasmania (9.3%), the Northern Territory (6.8%), and the Australian Capital Territory (3.2%). Yearly, private capex grew 10.7%, slowing from an upwardly revised 14.9% rise in the previous period.

Total new capital expenditure in Australia jumped 6.5% quarter-on-quarter in the first quarter of 2026, accelerating from an upwardly revised 0.7% rise in the previous quarter and far exceeding market expectations for a 1.0% gain. Investment in equipment, plant, and machinery rebounded sharply (18.1% vs -1.3% in Q4), led by a sharp increase in information, media, and telecommunications. Meanwhile, spending on buildings and infrastructure declined (-3.8% vs 2.5%), mainly attributed to lower investment in mining, utilities, and rental services. Regionally, capital spending rose strongly in New South Wales (22.1%) and Victoria (12.7%), while South Australia posted a modest gain of 0.2%. In contrast, investment in the Northern Territory plunged 39.8%, with declines also recorded in Queensland (-3.0%), Western Australia (-4.3%), Tasmania (-8.0%), and the Australian Capital Territory (-9.4%). Yearly, private capex surged 14.6%, after an upwardly revised 8.1% growth in the previous period.

Total new capital expenditure in Australia rose 0.4% qoq in Q4 2025, slowing sharply from a 6.4% growth in Q3 but beating market expectations for flat growth. Investment in buildings and infrastructure continued to expand (2.3% vs 2.3% in Q3), helped by large-scale projects in utilities, rental, hiring & real estate, and information and telecommunications. Within this category, non-mining capex increased 3.7%, while mining-related investment edged down 0.2%. By contrast, spending on equipment, plant, and machinery fell 1.7%, reversing an 11.2% surge previously. Non-mining equipment investment grew 0.8%, but mining equipment spending fell 0.8%. Regionally, capital spending rose in Victoria (2.0%), Queensland (0.7%), South Australia (4.8%), Western Australia (3.9%), and the Northern Territory (1.9%). Investment was flat in Tasmania, but it plunged in the Australian Capital Territory (-143%). On an annual basis, private capex rose 7.8%, faster than 6.9% in Q3.