GDP - Non-Mining Business Investment Razzle Dazzles

• Gross domestic product (GDP) rose by 1.0% in the March quarter, a solid pace of growth. Annual growth stepped up from 2.4% to 3.1%. It is the fastest annual rate of growth in nearly two years and matches the 20-year average for GDP growth.
• GDP growth in the quarter was driven by net exports and inventories. Business investment, household consumption and the government sector also contributed to growth.
• The razzle dazzle in today’s national accounts came from non-mining business investment. It rose by 3.6% in the March quarter and by 14.0% in the year to the March quarter. It is the third consecutive quarter of double-digit annual growth. Business conditions are at a record high and business confidence is at lofty levels, suggesting non-mining business investment can continue to improve. This improvement comes at a critical junction in the economy.
• Household consumption growth remains under pressure. Household consumption growth was only modest in the March quarter, growing by 0.3% and adding just 0.2 percentage points to growth in the quarter. Household consumption grew at its weakest rate since the March quarter of 2017 when it also grew at a 0.3% rate.
• State final demand growth in the quarter was mostly confined to the east coast of Australia and primarily driven by economic activity in Victoria. State final demand expanded by 1.9% in Victoria. Tasmania grew at a faster pace of 2.0%, but is a smaller share of the Australian economy.

 

Please see the attached report for more information.

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