New data has revealed Australian business investment jumped 3.3 percent in the June quarter, a sign that the economy is improving.
The ABS data revealed that business investment surged with spending on equipment and machinery helping to boost the figure for the June quarter. Equipment, plant and machinery purchases jumped 5.3 percent, while new buildings and structure increased a more modest 0.7 percent.
Economists said the rise was quite surprising, but meant that Australia was most likely going to avoid a technical recession.
According to Commonwealth Bank’s chief economist, Michael Blythe, the Government’s stimulus package has had a major effect on the economy.
“This is a very good result. Ecomonic policy is working, and the increase in plant, equipment spending in the June quarter is driven by government investment allowance,” he told Reuters.
Economists have now upgraded their forecasts for the next year.
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