The Australian Bureau of Statistics (ABS) released economic data today. Here are some key figures.
Growth
The Australian economy grew by 0.3% in the September 2024 quarter, representing the slowest annual growth rate since the end of 2020. This compares to a growth rate of 0.8% in September 2023 .
Over one year, gross domestic product (GDP) increased by 0.8%, continuing a trend of decelerating growth.
ABS National Accounts Manager Katherine Keenan said: “The Australian economy grew for the twelfth consecutive quarter but has continued to slow since September 2023.”
The public sector, engine of growth
Public sector investment jumped 6.3%, reaching record levels. The main drivers were imports of defense equipment, modernization of hospitals and infrastructure projects focused on roads and renewable energy. “The rise in public investment in the September quarter follows three consecutive quarterly declines. The level of investment this quarter was the highest on record,” Keenan said.
Public consumption increased by 1.4%, supported by social benefits such as reductions on energy costs.
Household spending stagnates
Household spending remained stable during the quarter, following a decline of 0.3% in June. Energy rebates contributed to a 16.7% drop in electricity and gas spending, but essential spending on rent, health and education increased. Disposable income increased by 1.5%, supported by stage three tax cuts which reduced household income tax payments by 3.8%. The household savings rate rose to 3.2%.
Trade and labor markets are stable
Net trade contributed slightly to GDP growth, with exports of goods increasing by 0.9% and imports decreasing by 1.5%. However, trade in services hurt performance, with fewer international students arriving and more Australians traveling overseas, particularly to Europe and Asia.
The labor market remained strong, with low unemployment and high participation levels, although job vacancies continued to decline.
Inflation slows, wages slow
Annual inflation fell to 2.8%, the lowest level since 2021. Goods inflation fell sharply to 1.4%, driven by lower electricity and fuel prices, while services inflation remained high at 4.6%, reflecting rising costs of rent and insurance. Wage growth slowed to 3.5%, following smaller increases in the minimum wage compared to 2023.
Economic challenges persist
GDP per capita fell 0.3% for the seventh consecutive quarter, highlighting continued pressures on living standards. Terms of trade (the ratio of export prices to import prices) also fell for the third consecutive quarter as export prices fell due to falling global demand for raw materials.
