03 September 2009

Australian economy grows more than predicted

The Australian economy has made 0.6 per cent economic growth for the three months to June, well ahead of economist forecasts of a 0.2 per cent rise.

The result was three times what the market expected, and financial experts have call the figures an "impressive pace".

National gross domestic product also increased 0.6 per cent for the full year to June.
Australia also posted a strong 0.4 per cent growth in the first three months of this year, which experts say reduces the chance of a technical recession in the country.

RBC Capital Markets senior economist Su-Lin Ong said: "We got growth in the quarter underpinned by private consumption, quite strong business investment, a little bit of public spending as well, and that more than offset a bit of a drag from net exports," she said.

"But it is an impressive outcome given, I think, what was still a very weak state in terms of the global economy, Australia has managed to grow at quite an impressive pace in the second quarter."

The stimulus package released by the Australian Government this year has been attributed to helping restore economic growth and boosting consumer confidence. 

Su-Lin Ong said it was clear that the Australian economy had probably much more momentum than previously thought and that it was into the second half of this year with that greater momentum and higher levels of confidence.

Economy results state by state:

• The New South Wales economy expanded by 0.5 per cent over the quarter in seasonally adjusted terms, after the previous two quarters' contraction.
• The Victorian economy expanded by 3 per cent over the quarter in seasonally adjusted terms, after the previous quarter's contraction.
• The Queensland economy contracted for a third consecutive quarter in seasonally adjusted terms, by 0.1 per cent.
• The South Australian economy expanded for a second consecutive quarter in seasonally adjusted terms, by 1.3 per cent.
• The West Australian economy expanded by 1.6 per cent in seasonally adjusted terms, after the previous quarter's contraction.
• The Tasmanian economy recorded no growth in trend terms, after the previous quarter's contraction.
• The Northern Territory economy contracted for a third consecutive quarter in trend terms, by 3.4 per cent.
• The Australian Capital Territory economy contracted for a third consecutive quarter in trend terms, by 0.4 per cent.

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