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SYDNEY: Australian business investment showed a surprise jump of 3.3 per cent quarter-on-quarter Thursday, increasing the likelihood that the economy will avoid a technical recession.
Analysts had tipped a 5.0 per cent fall in private new capital investment, but the Australian Bureau of Statistics said spending on equipment and machinery had boosted the figure for the June quarter.
Economists said the rise, indicating increased economic activity, meant Australia was less likely to post a quarterly contraction in figures released next Wednesday.
"I think the outlook, given capacity utilisation may well be starting to turn the corner, suggests some potential upside (to second-quarter growth)," said David De Garis, National Australia Bank senior economist.
Australia registered surprise 0.4 per cent growth in the three months to March, becoming the only major Western nation at the time to avoid recession during the global slump.
The government, in its official budget forecasts, flagged a 0.5 per cent contraction in 2009-2010 before a rise to 2.25 per cent growth in 2010-2011.
De Garis said he expected next week's growth figures would show a gross domestic product rise of 0.5 per cent on-quarter.
- AFP/yb
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