ABS: GDP numbers beats forecasts but growth remains weak
Faltering household spending and weak productivity growth dragged down the Australian economy in the June quarter, but growth was still stronger than anticipated, new data shows.
The economy expanded by 0.4 per cent in the three months to June according to new national accounts figures released by the Australian Bureau of Statistic on Wednesday.
The GDP growth figures were steady after a 0.4 per cent increase in March, and beat consensus forecasts of 0.3 per cent for the June quarter.
The annual growth rate fell from an upwardly revised 2.4 per cent to 2.1 per cent, as persistent price pressures and high interest rates acted as a handbrake on economic activity.
After accounting for the a jump in population due to the country’s soaring migration intake, real GDP on a per capita basis fell by 0.3 per cent.
The ABS measure for labour productivity, output per hours worked, fell 2.0 per cent in the June quarter and by 3.5 per cent over the past year bringing productivity to March 2016 levels.
As the Reserve Bank’s efforts to dampen demand through 12 interest rate increases filter through the economy, household consumption grew by just 0.1 per cent and is consistent with other data which shows higher borrowing costs are pushing down spending on non-essential purchases.
Discretionary consumption declined 0.5 per cent in the June quarter, down from a 0.2 per cent fall in March.
The households savings ratio also fell from 3.6 per cent to 3.2 per cent, the lowest level since June 2008.
Speaking before National Accounts, Treasurer Jim Chalmers said economic growth would remain weak over the forecast period.
“Our expectation, our forecast in the budget, are that the Australian economy will continue to grow but quite slowly,” Dr Chalmers told ABC News on Wednesday.
More to come