And, surprisingly, Australian firms seemed confident about the future, with the latest estimate for spending plans for 2020/21 at A$98.6 billion, 8.9% higher than the previous estimate.
"Both machinery and equipment investment as well as construction investment fell less than we had anticipated in Q2 which suggests that the contraction in GDP wasn't as deep as we thought," Capital Economics analyst Marcel Thieliant wrote in a note.
Second quarter gross domestic product (GDP) data is due on Wednesday which will confirm Australia's first recession in three decades after output shrank in the March quarter.
In an effort to blunt the economic shock, the country's central bank has slashed interest rates to an all-time low of 0.25% and launched an "unlimited" bond buying programme while urging the government to boost fiscal support.
Following Thursday's better-than-expected report Thieliant has upgraded his GDP forecast to 4.5% contraction for the June quarter from an earlier prediction of a 6.5% slump.
"The upshot is that the outlook for capital spending isn't as gloomy as one would expect in the current environment," he noted.
($1 = 1.3808 Australian dollars)
(Reporting by Swati Pandey; Editing by Christian Schmollinger & Shri Navaratnam)
(Only the headline and picture of this report may have been reworked by the Business Standard staff; the rest of the content is auto-generated from a syndicated feed.)
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