Business confidence recently surged to its highest level since the euphoria that coincided with the conclusion of Australia’s federal elections last September. But the outlook for business investment remains mixed, though the second quarter finally saw a much-needed lift in capital spending.

According to the Australian Bureau of Statistics (ABS), total capital expenditures rose by a seasonally adjusted 1.1 percent quarter over quarter, to AUD37.65 billion.

The consensus forecast among economists surveyed by Bloomberg had been for spending in this area to drop by 0.9 percent, so this was an important beat. Additionally, the first-quarter number also improved from what was initially reported, with a revised decline of 2.5 percent versus the original report of a fall in spending of 4.2 percent.

Despite the relief from this recovery in spending, it should still be noted that capital expenditures are down 4.0 percent from a year ago.

Second-quarter spending was driven by investment in buildings and structures, which increased 2.0 percent quarter over quarter, to AUD25.3 billion. Unfortunately, investment in machinery and equipment, an area we’ve been closely monitoring, declined by 0.9 percent, to AUD12.4 billion.

Even so, there was at least one other significant bright spot. Although the peak in mining investment is past, industry spending surprised economists with a 0.2 percent increase, to AUD20.6 billion. Analysts had expected a sharp drop in sector spending.

On the other hand, capital spending by manufacturers fell 6 percent, to AUD2.1 billion.

And the outlook for the coming year isn’t all that reassuring. Capital spending for fiscal-year 2015 (ending June 30) is expected to fall by 10.2 percent year over year, to AUD145.2 billion, based on a survey of businesses by the ABS.

Of course, that doesn’t mean the situation can’t change. After all, the aforementioned jump in business confidence appears to have occurred in the weeks after the ABS survey.

Still, it does show that the Reserve Bank of Australia’s (RBA) hope for the non-mining sectors to take over leadership of the country’s economy still faces significant hurdles. RBA Governor Glenn Stevens has recently asserted that the country’s policymakers need to do more to revive the “animal spirits” of the entrepreneurs who help drive economic growth.

A look at the short-term and medium-term picture underscores these challenges.

Over the trailing three-year period that ended June 30, private capital expenditure grew at an average rate of 1.8 percent per quarter. But over the trailing year, spending in this area has declined by an average of 1.0 percent per quarter, with the second quarter’s performance a welcome rebound from the swoon in spending over the prior six-month period.

So what does capital spending look like when an economy is firing on all cylinders? As the resource boom got underway, private capital expenditures averaged a robust 5.9 percent per quarter, over the two-year period from mid-2010 through mid-2012, peaking at 14.0 percent in the third quarter of 2011.

However, there is some disagreement among economists over whether the ABS statistics fully reflect the transition underway in Australia’s economy.

For instance, The Australian cites Barclays chief economist Kieran Davies’ assertion that the ABS survey does not include key sectors such as health and education, and that ABS data also captured less than 40 percent of total service sector investment.

“Spending outside of the scope of the survey has been robust over the past couple of years, growing at a roughly 10 percent annual rate,” Mr. Davies said. He believes that actual spending could rise by 9 percent this fiscal year, thanks to a 12 percent jump in capital expenditures in the service sector.

So even if the official data are cause for some gloom, the economy’s actual performance could prove surprising to the practitioners of the so-called dismal science.