Australian economic growth accelerated in the second quarter, promoted by household consumption, since a more flexible monetary policy underpinned the activity.
The Gross Domestic Product, GDP, advanced 0.6% in the three months until June, faster than 0.5% planned and twice the revised rhythm on the anterior trimester of the previous quarteraccording to data from the Australian Statistics Office published on Wednesday. The annual expansion of 1.8% is compared to the expected increase of 1.6%.
The figures “should dissipate the fears of a growth slowdown” and will probably keep the reserve bank in September, according to Prashant Newnaha, senior strata of rates for Asia-Pacific of TD Securities in Singapore. “Employment would have to be a shock for the Bank of the Australian Reserve (RBA) to cut the rates at the end of this month.”
The result is slightly higher than the expectations of the RBA and promoted the reversal of currency losses, while the performance of the government bonds for three years, Sensitive to monetary policy, extended its previous gain. The monetary markets maintained the expectations that the bank will maintain the monetary policy without changes in September and will cut it in November.
GDP figures show that interest cuts are transferred to homes and companies And they will give the RBA greater confidence in the capacity of the economy to grow without depending so much on additional fiscal support.
Even so, the report indicates that the economy in general is having a lower performance than the average of 20 years prior to the pandemic, almost 3%. The latest RBA forecasts foresee a 1.7% GDP increase this year, a lower rate than its decreased downward over the long -term potential growth of the economy.
The Central Bank last month reduced the interest rate to 3.6%, its third reduction of the year, and pointed out that a couple more cuts will be needed to meet their employment and inflation objectives. The RBA considers that monetary policy remains “still somewhat restrictive”, even with the interest rate that counted at its lowest level since April 2023.
The RBA is trying to evaluate how much more can more flexible in an still adjusted labor market and of little growth of productivity.
“Fiscal year sales and new products launches contributed to increases in discretionary expenditure on goods, including furniture and home equipment, motor vehicles and recreational and cultural goods”Said Tom Lay, Chief of National ABS accounts, in a statement.
Public investment fell 3.9% and was the largest detractor of growthSaid the ABS, and added that excluding the Covid period, this was the largest fall since September 2017.
The performance of Australia’s productivity is behind that of much of the developed world and The center -left Labor Government last month called for a meeting of business leaders, unions, government officials and other experts to generate ideas that help reverse that trend.
Treasurer Jim Chalmers highlighted 10 consensus areas and already announced plans to eliminate several of the so -called “annoying tariffs.” However, although the government can try to create the conditions for greater productivity, the private sector must also play its role.
GDP data covered a period of global volatility and some internal uncertainty. President Donald Trump revealed his initial tariff plans, What caused agitation in the markets, while Australia was in the midst of an electoral campaign that seemed more at odd than the overwhelming victory that finally won the Labor Party in early May.
Australia’s economic growth has been anemic in recent times, with per capita production by decreasing for seven consecutive quarters until 2023 and much of 2024, a sign of the fall of the standard of living.
The GDP per capita resumed its descent in the first quarter, falling 0.2%, before reverse that fall in the second quarter.
