Maybank FX Flash - AUD/USD: Rises on CAPEX

AUD/USD: Rises on CAPEX

§  2Q CAPEX surprised to the upside with its seasonally adjusted estimate beating the consensus of 0.3%q/q with an actual print of +1.1%. Details were mixed.  Bulk of the spending came from buildings and structures in mining and other selected industries while that of equipment, plant and machinery slipped 0.9%q/q. §  AUD/USD spiked to a high of 0.9372. Further bids were hindered as market players digest the report, lest one gets too bullish on the 2Q GDP print next Wed (3 Sep). Still, the CAPEX report reveals some progress in economic rebalancing efforts though survey details were mixed. Projections indicate an uneven improvement in business spending sentiments. §  We hold our view that RBA should keep cash target rate steady at 2.50% for the rest of the year and well into the first half of 2015. In fact, we do not expect a rate hike until 2H of 2015.