Andrew Hanlan, Research Analyst at Westpac, explains that the Australia’s March quarter national accounts provided further confirmation that the Australian economy performed solidly over the past year, but areas of weakness persist and are likely to weigh on the outlook.
Key Quotes
“Real GDP grew by 1.0% in the March quarter, lifting annual growth to 3.1% – an above trend outcome, with trend judged to be 2.7%. Non-farm GDP grew by 3.6% over the year, the strongest annual outcome since 2012. These results bring output growth more into line with that for employment, which increased by 3.5% over the year.”
“Economic conditions have been supported by a combination of global and domestic forces, leading to conditions becoming more synchronised across the state economies.”
“Weaknesses remain, particularly around the consumer and housing.”
“In summary, key positives around pubic demand, business construction investment and exports will provide a solid base for overall economic activity However, with weaknesses in consumer spending and housing we expect GDP growth to moderate to 2.7% in the year to December 2018 and then slip to a below trend 2.5% for December 2019.”
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