Weak Australian construction work data pushes the Aussie lower

According to the Australian Bureau of Statistics Australia, construction work done for the fourth quarter of 2018 has declined more than expected.

Australia construction work Q4 Source: Bloomberg

ABS data shows Australia's construction work done for the fourth quarter of 2018 has declined more than expected.

Fourth quarter construction work comes in at -3.1%, missing expectations by a long shot. Analysts say it was widely expected to jump 0.5% from previous year which was -2.8%.

IG market analyst Kyle Rodda says, the data shows that we haven't turned the corner in that part of the economy yet.

‘For years construction fuelled growth post-mining boom, but now that's fallen away. It's not good for the growth outlook, and it makes CAPEX data tomorrow that little bit more interesting.’ Mr. Rodda said.

It comes after construction work data also declined in Q3, but despite the last quarter decline, expectations for the final quarter were still higher.

Analysts say the weak data plays into Australia’s Gross Domestic Product (GDP) which is due to be released next week.

ABS figures on construction and engineering

According to the ABS the trend estimates for total construction work done fell 2.5% this quarter and has fallen for three quarters.

The trend estimates for total building work done fell 1.2% this quarter and has fallen for two quarters.

Total construction in seasonally adjusted terms fell 3.1 % in Q4 and the total value of construction work done last year was $51.6 billion, around 2% lower than in 2017.

The trend estimate for engineering work done fell 4.0% in the December quarter, while the seasonally adjusted estimate for engineering work done fell 5.0% to $21,492.8m in the December quarter.

Australian dollar price

AUD/USD slightly just below $0.7185 after the data. The pair traded to $0.7200 in early trade on Wednesday just ahead of resistance at $0.7200


This information has been prepared by IG, a trading name of IG Markets Limited. In addition to the disclaimer below, the material on this page does not contain a record of our trading prices, or an offer of, or solicitation for, a transaction in any financial instrument. IG accepts no responsibility for any use that may be made of these comments and for any consequences that result. No representation or warranty is given as to the accuracy or completeness of this information. Consequently any person acting on it does so entirely at their own risk. Any research provided does not have regard to the specific investment objectives, financial situation and needs of any specific person who may receive it. It has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such is considered to be a marketing communication. Although we are not specifically constrained from dealing ahead of our recommendations we do not seek to take advantage of them before they are provided to our clients. See full non-independent research disclaimer and quarterly summary.

Start trading forex today

Trade the largest and most volatile financial market in the world.

  • Spreads start at just 0.6 points on EUR/USD
  • Analyse market movements with our essential selection of charts
  • Speculate from a range of platforms, including on mobile

Live prices on most popular markets

  • Forex
  • Shares
  • Indices
Bid
Offer
Updated
Change
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
Bid
Offer
Updated
Change
-
-
-
-
-
-
-
-
-
-
-
-
Bid
Offer
Updated
Change
-
-
-
-
China 300
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-

Prices above are subject to our website terms and agreements. Prices are indicative only

Plan your trading week

Get the week’s market-moving news sent directly to your inbox every Monday. The Week Ahead gives you a full calendar of upcoming economic events, as well as commentary from our expert analysts on the key markets to watch.

You might be interested in…

Find out what charges your trades could incur with our transparent fee structure.

Discover why so many clients choose us, and what makes us a world-leading provider of CFDs.

Stay on top of upcoming market-moving events with our customisable economic calendar.

CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 75% of retail investor accounts lose money when trading CFDs with this provider.You should consider whether you understand how CFDs work, and whether you can afford to take the high risk of losing your money. CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage.