Australia see 25 years of unbroken economic expansion
AUSTRALIA’S economy grew by 0.5 percent in the June quarter with an upswing in government spending offsetting a fall in net exports as the nation marked 25 years of uninterrupted economic expansion.
The Australian Bureau of Statistics data, which showed annual growth at 3.3pc, was in line with expectations as the economy continues its shift away from an unprecedented boom in resources investment.
“It’s official, Australia has now achieved 25 years of uninterrupted economic expansion,” said Treasurer Scott Morrison.
A 1.1pc expansion in the JanuaryMarch quarter was driven by net exports and household spending, but exports – a key growth engine – were a drag for the April-June number.
Over the three months, they detracted 0.2 percentage points from GDP with stronger-than-expected government spending the saviour as public investment grew by 15.5pc quarter-on-quarter.
The Australian dollar, which climbed ahead of the data, fell slightly after the announcement to 76.58 US cents but soon recovered.
Capital Economics chief Australia economist Paul Dales said the quarterly growth was “a good result” and should ease pressure for further interest rate cuts.
“The return of the Australian economy in the second quarter to the growth rates seen before the end of the mining boom relieves some of the pressure on the RBA to cut interest rates again,” he said.
The Reserve Bank has held interest rates at a record low of 1.5pc, having cut them twice in the past four months in a bid to boost sluggish inflation as the economy transitions toward nonresources growth.
‘[The growth] relieves some of the pressure on the RBA.’
Paul Dales Capital Economics