The mining investment boom is not over and is expected to stay strong for the coming year.
Capital expenditure by businesses rose by 4.0 per cent in the June quarter, the Australian Bureau of Statistics said, higher than the 0.8 rise the market was expecting.
HSBC chief economist Paul Bloxham said the figures were quite positive.
"They confirm that mining investment is set to plateau, not plummet in the coming year," he said.
It is hoped that as mining investment levels off, investment in other parts of the economy will pick up, but Mr Bloxham said this may not happen immediately.
"That part of the story is less positive looking at the capital expenditure survey today, but we do expect there will be a gradual rebalancing of growth," Mr Bloxham said.
During the 2013/14 financial year, businesses expect to invest $159.236 billion, which is 11.2 per cent lower than the estimate made for 2012/13 this time last year.
Mr Bloxham said he doesn't think the Reserve Bank of Australia will need to cut the cash rate from its current level of 2.5 per cent this year.
"We think the falling Aussie dollar is going to a lot of the work for the RBA and it is unlikely to cut further," he said.
ANZ chief economist Ivan Colhoun said it was a good sign that business investment had beat expectations in the June quarter.
But the key figure to watch, non-mining investment, was disappointing, he said.
"The non-mining capex was a bit softer than we were looking for," Mr Colhoun said.
"It's still signalling that there isn't much in the way of this transition from mining investment to non-mining investment going on."
Non-mining investment rose by 0.7 per cent in the June quarter, but was down by 5.3 per cent from a year earlier, in real seasonally adjusted terms.
"The mining estimates are holding up but we know they're going to come off, it's just a question of when," Mr Colhoun said.
"Mining is peaking and is beginning to roll over but outside of mining, things have been quite soft."
Mr Colhoun said further interest rate cuts could help to rebalance the economy as the mining investment boom slows down, but a lower Australian dollar would be of more assistance.
CommSec economist Savanth Sebastian said the economy is not ready to transition from mining.
"It's still very early days to suggest there's a turnaround taking place in the investment story," he said.
"It's going to take some time for the economy to structurally adjust."
Mr Sebastian said Australia's shift to non-mining activity needed to be fostered by the RBA.
"It certainly means the Reserve Bank will maintain an easing bias over the next year," he said.
Business confidence is expected to benefit from a higher rate of investment, but conditions remain challenging.
"So while most businesses believe the environment has to some degree de-risked, there's still a level of uncertainty that's holding back investment plans," Mr Sebastian said.
He also said wage growth and employment remained sluggish.
"I don't think that's an environment that's going to change immediately."