Australia's falling capex a signal of growth challenges - Moody's

FXStreet (Bali) - Moody's credit outlook, released today, notes that Australia's disappointing capital expenditure figures last week is a signal of growth challenges, Bloomberg reports.

Key headlines

"Capex "numbers and accompanying projections for investment in the coming year signal a decline in investment in Australia despite historically low global and domestic interest rates."

"Unless the trend reverses, Australia's growth over the next two years will be lower than the 2.9% average of the past decade."

"Government tax revenues will grow more slowly, impeding efforts to stabilize government debt, which increased to 30.7% of GDP in 2014 from 9.7% in 2008."

"Could reduce foreign direct investment inflows, which would either exacerbate lower growth or increase the country's reliance on more volatile portfolio and debt capital to finance its current account deficit."