Australia Economy Records Growth In Spending, Energy Exports

Australia’s economy picked up speed in the June quarter as spending and energy exports boomed.

Data from the Australian Bureau of Statistics on Wednesday showed gross domestic product (GDP) rose 0.9 per cent in the second quarter, in line with forecasts and up on the first quarter’s 0.7 per cent rise.

Also, annual growth accelerated to 3.6 per cent as the lowest unemployment rate in almost five decades underpinned household incomes and spending.

Inflation was widespread in the GDP report, with its main price index jumping 6.9 per cent for the year, the fastest pace since 1988/89.

Compensation of employees, a proxy for wages, boasted the biggest gain since 2010 as firms were forced to pay to attract and retain staff amid an unemployment rate of just 3.4 per cent.

Sean Crick, head of National Accounts at the ABS, Australia said; “Households increased spending on domestic and international travel as COVID restrictions further eased and international borders remained open.

“While spending on transport grew strongly, households were still only spending two-thirds of what they did pre-pandemic.”

Household spending added 1.1 percentage points to growth in the quarter. 

Australians have the means to keep shopping as the savings ratio dipped to 8.7 per cent, still well above pre-pandemic levels.