Economic growth is slower than expected
The economy expanded at a slower than expected rate in the three months to September, as weak consumer spending and a drop in public investment weighed on growth.
SYDNEY - [AAP] The economy expanded at a slower than expected rate in the three months to September, as weak consumer spending and a drop in public investment weighed on growth.
The economy grew 0.6 per cent in the September quarter, taking the annual rate of growth to 2.8 per cent, the Australian Bureau of Statistics said on Wednesday.
That was slightly lower than market expectations for quarterly growth of 0.7 per cent and 3.0 per cent over the year to September.
September quarter growth compared to a revised 0.9 per cent in the June quarter.
The Australian dollar dropped, slipping to 75.84 US cents by 1230 AEDT, from 76.13 US cents ahead of the release of the data at 1130 AEDT.
The figures showed 17 out of 20 industries recorded growth during the quarter, underlining an improvement in business conditions and growth in corporate earnings over the last few quarters.
However, consumer spending remained weak, under pressure from rising household debt and soft wages growth.
Household consumption expenditure increased only 0.1 per cent in the September quarter, making it the lowest quarterly rate of growth since the March quarter of 2005.
Economic growth was also impacted by a 7.5 per cent decline in public investment during the September quarter, as state and local government spending returned to normal after the previous quarter's growth was inflated by the South Australian government's acquisition of the Royal Adelaide hospital.
International trade also did not contribute to third quarter economic growth due to a decline in commodity prices, despite both export and import volumes rising in real terms.
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