EPA-EFE/BIANCA DE MARCHI
Australia’s economic growth was below expectations, with GDP growing 0.6 percent in the September quarter and 5.9 percent for the year, the Australian Bureau of Statistics (ABS) said.
This is Australia’s fourth consecutive quarter of economic growth after a decline last year during the Covid-19 lockdown. However, growth slowed down compared to 0.9 percent in the previous quarter.
This time too, population consumption was the key driver of economic growth, as life returned to a more normal framework after two years of major disruptions due to the pandemic. Thus, household consumption increased by 1.1 percent in this quarter, contributing to GDP by 0.6 percentage points, ABS announced.
First of all, there was an increase in spending in hotels and restaurants by 5.5 percent, on transportation services by 13.9 percent and higher purchases of vehicles by 10.1 percent.
– As travel restrictions due to covid were lifted, households began to increase spending on domestic and international travel – said Sean Crick, Head of National Accounts at the ABS.
However, Kapital Ekonomiks analyst Marcel Tilijent believes that GDP growth will stop next year. According to his assessment, growth in the third quarter is likely to be the last, as a tighter monetary policy and a drop in real incomes weigh on consumption.
Tilijent expects economic growth next year to be only one percent, which is not dramatically different from the Reserve Bank’s (RBA) forecast of 1.5 percent.
At this moment, the factor that supports the economy is a slightly higher growth in the wages of employees. The ABS said growth of 3.2 percent in the quarter was the biggest since December 2006 and was driven by very low unemployment.
And while wages started to rise, it should be borne in mind that they fell by 2.5 percent last year. In addition, a significant part of the wage increase is not actually available to households, bearing in mind that the amounts paid into pension super funds have been increased from ten to 10.5 percent since July 1.
In addition, it is predicted that the further growth of the cash interest rate will take even more money from the household budget, which has already reduced the savings rate to the pre-pandemic level – from 8.3 to 6.9 percent.
Banks profited, production fell
The financial sector profited due to the constant passing on of interest rate increases by banks to credit users. Thus, the operating surplus of financial corporations jumped by 4.9 percent. However, the manufacturing industry saw both a fall in output and a drop in income, as the sector continued to struggle with high input costs and supply chain issues.
Source: Vesti online by www.vesti-online.com.
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