Since the “recession we had to have” as the recession of 1990/91 became known, Australia’s GDP growth has been consistently positive, with only the odd negative quarter here and there. Even during, and immediately after, the GFC, Australia managed to avoid two consecutive quarters of negative growth. However, recent forward-looking indicators have more than a few economists concerned and expectations of an official rate cut have increased markedly in recent months.
The latest figures released by the ABS indicate December quarter GDP grew by just 0.2%, which is below the market consensus figure of 0.3% expected by economists. Growth in the quarter was even less than September’s revised figure of 0.3% and the year-on-year growth figure slowed from 2.7% to 2.3%.
Westpac senior economist Andrew Hanlon said, “The December national accounts provided no major surprises. Headline GDP and the detail around the consumer were broad as anticipated, so too information on housing, investment and public demand.”