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SYDNEY - The latest Australian Bureau of Statistics' capital expenditure survey suggested that the outlook for mining investment in the current financial year remained very strong, the Reserve Bank of Australia (RBA) said in the minutes of its September board meeting released on Tuesday.
"If the fall in the iron ore and coking coal prices were to be sustained, it could lead to somewhat lower mining investment," the minutes said.
"But given the large LNG and other mining investment projects already underway, the staff still expect there to be a substantial increase in resource investment over the next year or so."
The RBA's comments came after global miners BHP Billiton, Rio Tinto and Fortescue Metals Group put on hold their projects due to commodity price falls and declining demand from China.
"Members noted that the large Australian producers of iron ore had achieved record levels of production in the first half of the year, and production was expected to increase further over the coming year," the minutes said.
The RBA also said there were some tentative signs that Chinese growth might be stabilizing at a more sustainable pace.
"However, the most recent data had been a touch weaker, and this had been accompanied by a sharp decline in spot prices for iron ore and coking coal," the minutes said.
"If sustained, this decline would imply a larger fall in the terms of trade than earlier forecast, though the terms of trade would still remain high by historical standards."