Amidst perception that domestic growth has stalled and key industries outside of the mining arena were struggling, the Australian Bureau of Statistics (ABS) unfurled on Thursday some glimmer of hope as it reported a considerable spike in investment flow during the first quarter this year.

According to ABS, capital expenditures by the end of March 2012 surged by 6.1 per cent and exceeded the modest projections earlier set by economists.

The climb was recorded as the Reserve Bank of Australia (RBA) issued earlier a downward revision on the country's growth prospect for the remaining quarters of 2011, which was preceded by its decision push down the borrowing cost at 3.75 per cent.

The RBA's May policy rates shaved off a lofty 50-basis-point from Australia's cash rate following months of holding off that started in January.

The RBA had intended for some form of stimuli to be felt in the domestic setting, which has become wary of the unsettling situation in Europe, but economists said that the CAPEX jump in March paled in comparison to previous periods.

James McIntyre of the Commonwealth Bank told the Australian Associated Press (AAP) that while the Q1 uptick on business investments made some case for a solid economic environment in the country, the surge was "not as strong as was forecast three months ago."

"It does look like the backdrop of international uncertainty may have weighed on what firms are expecting to do in the quarters ahead," Mr McIntyre said as he pointed to reports that a number of business operators have opted to tame their spending for the moment.

For one, mining giant BHP Billiton has admitted that it may need to review its expansion blueprint for its iron ore division in light of the softening prices of commodities in the global market.

That means BHP will hold on for some time to the $80 billion that it said it will spend to ramp up its iron ore production over the next five years.

Its nearest rival, Rio Tinto, also announced that expansion will remain on it agenda but its CEO, Tom Albanese, indicated too that after achieving specific levels of production, the company may consider a review of its production plans.

The general gloom has been flagged on the Housing Industry Association report last week, which carried warnings that the property sector may soon enter a recession phase owing to the weak sales returned in the first quarter by national housing industry.

This was confirmed today as the ABS said that building activities retreated last month as approvals declined by 8.74 per cent in April, highlighting the sector's biggest challenge to date following the boom it experienced in 2008.

Investments, however, will continue to fuel the economy in the current year but local and international indicators have prompted economists to downgrade their CAPEX prospects.

From 36 per cent in January, Mr McIntyre said that Australia can now expect lower investment inflow of 30 per cent in 2012.