5232.0 - Australian National Accounts: Finance and Wealth, Sep 2019 Quality Declaration 
Latest ISSUE Released at 11:30 AM (CANBERRA TIME) 19/12/2019   
   Page tools: Print Print Page Print all pages in this productPrint All RSS Feed RSS Bookmark and Share Search this Product

CAPITAL INVESTMENT

CAPITAL ACCOUNT

Australia increases its net lending

Australia recorded its second consecutive quarter of net lending following 44 years as a net borrower. Australia's net lending increased by $3.2b this quarter to $7.7b. The ratio of net lending to GDP increased to 1.5%.


Graph 1. National net lending (net borrowing), relative to GDP, seasonally adjusted
Graph 1 shows National net lending (net borrowing), relative to GDP, seasonally adjusted


At the sector level, households transitioned from being a net borrower to a net lender this quarter. This was driven by an increase in net saving, which was impacted by the Low and Middle Income Tax Offset (LMITO) policy. The general government sector saw a corresponding decline in net saving and an increase in net borrowing.

Non-financial corporations net borrowing declined by $2.7b, driven by private non-financial corporations. Private non-financial corporations became net lenders this quarter following an increase in net saving and a fall in gross fixed capital formation.


Graph 2. Net lending (net borrowing), by sector, seasonally adjusted
Graph 2 shows Net lending (net borrowing), by sector, seasonally adjusted


National capital investment as a proportion of GDP falls to a historical low

National capital investment fell to 22.4% as a proportion of GDP this quarter, continuing its downward trend since December quarter 2017. This is the lowest level in the history of the series.

Non-financial corporations investment as a proportion of GDP declined from 10.3% to 10.1%. This is the eighth consecutive quarterly decline and reflects the transition of mining from the investment to the production phase. Weakness in machinery and equipment investment also contributed to the fall this quarter.

Investment by households fell from 7.9% to 7.8% as a proportion of GDP. The downward trend in this ratio reflects weaker dwelling investment.


Graph 3. Gross fixed capital formation, by sector, relative to GDP, seasonally adjusted
Graph 3 shows Gross fixed capital formation, by sector, relative to GDP, seasonally adjusted