Australia’s economy grew at an annualised rate of 4.2 per cent in the third quarter of 2018, a new survey has found.
The Reserve Bank’s quarterly economic update released on Wednesday showed gross domestic product grew at a 2.2pc annualised pace in the March quarter, and unemployment fell to 3.1 per cent.
Its quarterly GDP is the sum of the annualised GDP and the consumer price index, which is compiled from consumer spending, the trade balance and imports.
Inflation fell to 1.1pc in the April quarter, a small drop from 2.9pc in March, but still higher than the 0.9 per cent annual rate of inflation seen in the second quarter of 2017.
“The growth outlook continues to be robust, with the economy growing at a pace that has been broadly consistent over the past year,” the Bank of Australia said in its annual update.
Despite the strong performance, the economy remained heavily reliant on energy consumption, which accounted for over a quarter of gross domestic products growth in the first three quarters.
Australia’s economy was a net contributor to global GDP, with a cumulative economic impact of $10.6 trillion in 2019, the Reserve Bank said.
This includes $3.6tn in energy imports and exports, which helped fuel the strong economic growth in Australia in recent years.
With the economy recovering from a financial crisis in 2014, there is a clear opportunity for the economy to continue to grow at a healthy pace, the report said.
“A recovery in the growth rate will not come until the unemployment rate stabilises and inflation slows,” the report noted.
Labor has accused the Reserve Board of being politically motivated.
Treasurer Scott Morrison has previously promised a recovery to Australia’s fragile economy and a return to the gold standard.
It has also raised concerns about the effectiveness of the Reserve’s economic forecasts, which were based on assumptions that the economy would grow at the same pace as in the 2016-17 fiscal year.
Mr Morrison told ABC Radio in December that his view on the economy’s growth rate was based on the fact that it was growing at the 3.8 per cent rate of the previous year, which he had predicted.
But Mr Morrison has since indicated that his prediction was wrong, arguing that the current economic cycle is a “very long one”.
The unemployment rate remains high, at 6.3 per cent, but Mr Morrison recently told ABC radio that the unemployment benefit rate was being used as a “political football”.
He told reporters on Tuesday: “I think the unemployment benefits that people get, I think are a good thing because people can afford to stay at home and go to work and earn a wage and they can save and they’re able to invest.”
The Australian Bureau of Statistics said the unemployment figure could be higher, because of people who had been actively looking for work.
Topics:economy-and-finance,business-economics-and,business,government-and/or-politics,business—business-group,jobs,government,employment,recession,government—parties,national-security,australia,aesthetics,travel,religion-and-(beliefs-and)-spirituality,people,united-statesFirst posted October 07, 2019 12:46:35Contact Nicky MaynardMore stories from Western Australia