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FINANCING RESOURCES AND INVESTMENT, ORIGINAL, CURRENT PRICES
During December quarter 2015, non-financial corporations and household invested $53.8b and $43.5b respectively in capital formation. Non-financial corporations funded these investments mainly through gross saving ($42.8b) and net borrowing ($19.7b). Household funded their investment through gross savings ($42.8b).The general government sector invested $13.1b in capital formation funding it through net borrowings ($7.4b) and gross saving ($6.9b), where consumption of fixed capital contributed $9.0b.
Graph 1. Total capital formation, current prices
In original terms, national capital investment increased $7.4b from the September quarter 2015 estimate to $113.2b in December quarter 2015. The increase was driven by a $5.3b rise in gross fixed capital formation, which was aided by a $2.1b increase in change of inventories.
Private non-financial corporations gross fixed capital formation has fallen since peaking in June quarter 2013 ($59.2b), this has been driven by decreased non-dwelling construction investment. Conversely, household gross fixed capital formation has continued to grow since March quarter 2014 ($30.0b), this has been driven by increased investment in dwellings.
Graph 2. Net financial investment (Net lending (+) / net borrowing (-))
Source(s): Table 4. National Financial Assets and Liabilities ($ million); Table 6. Financial Assets and Liabilities of Non-Financial Corporations ($ million); Table 14. Financial Assets and Liabilities of Financial Corporations ($ million); Table 27. Financial Assets and Liabilities of General Government ($ million); Table 33. Financial Assets and Liabilities of Households ($ million)
During December quarter 2015, national net borrowing was $21.1b, driven by non-financial corporations borrowing of $19.7b and general government borrowing of $7.4b. By contrast, household lent $4.2b to other sectors.
Net borrowing of $19.7b by non-financial corporations was a result of incurring $3.8b in liabilities while disposing $16.0b in financial assets. Non-financial corporations net disposal of financial assets (-$16.0b) was driven by loans and placements (-$19.4b) where non-resident counterparts repaid $15.4b in loans. Non-financial corporations incurred a net $3.8b in liabilities with $13.3b in issuance of listed equity and $10.2b in bonds issued offshore offset by a sale of $14.1b in unlisted equities, a reduction in accounts payable (-$4.5b) and net settlements of derivatives (-$3.6b).
Net borrowing of $7.4b by general government was due to the disposal of financial assets (-$6.1b) while incurring $1.3b in liabilities. The general government sold equity in state and local public non-financial corporations ($10.8b) through the privatisation of state owned non-financial corporations during the quarter. This was partially offset by an increase of $7.3b in accounts receivable. The general government incurred liabilities through issuance of bonds ($8.4b) which was partially offset by a repayment of loans (-$4.0b) and maturities of short term debt securities ($3.4b).
Household remained net lenders ($4.2b) in December quarter 2015. Household acquired $29.2b in financial assets through net equity and reserves ($25.4b) and increases in bank deposits ($19.8b) while incurring liabilities through loan borrowings ($26.3b).
Financial corporations remained net lenders ($1.9b) by acquiring $25.7b in financial assets while incurring $23.8b in liabilities. The financial corporations sector acquired financial assets through loans and placements ($43.5b) driven by lending to household ($26.9b), rest of world ($14.2b) and other private non-financial corporations ($9.0b). Financial corporations acquired equity in other private non-financial corporations ($18.9b) and rest of world ($5.7b). These acquisitions were partially offset by derivative settlements of -$41.0b. Financial corporations incurred liabilities during the quarter through deposits ($22.5b), and net equity in reserves ($20.9b) which were partially offset by derivative settlements of -$39.3b.
CHANGES TO THIS ISSUE
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REVISIONS IN THIS ISSUE
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CHANGES IN FUTURE ISSUES
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