Mining sector downturn hits home

WHILE WA has the strongest housing sector in the country, pressure on the mining sector has started to bite in WA, according to the Challenge Bank’s June quarter Market Insights.

This in turn is having a detrimental affect on private capital spending which is estimated to have contracted around 10 per cent in 1998-99 on the back of an estimated 35 per cent fall in mining investment.

Mining investment dominates total investment in WA. In 1997/98, mining investment accounted for 60 per cent of total investment.

The Challenge Bank index of consumer sentiment is a healthy 12.2 per cent above its level a year ago. Strong consumer sentiment has manifested itself by good retail sales volumes and car sales bouncing back after two weak quarters.