The Australian Bureau of Statistics (ABS) today released economic indicators. Here are some key numbers.

growth

Australia’s economy grew by 0.3% in the September 2024 quarter, the slowest annual growth rate since late 2020. In comparison, the growth rate in September 2023 was 0.8%.

Compared to the previous year, gross domestic product (GDP) increased by 0.8%, continuing the trend of slowing growth.

“Australia’s economy has grown for 12 consecutive quarters, but has continued to slow since September 2023,” ABS head of national accounts Catherine Keenan said.

Public sector drives growth

Public sector investment increased by 6.3%, reaching a record level. Key drivers include imports of defense equipment, hospital renovations, and infrastructure projects with an emphasis on roads and renewable energy. “Public investment increased in the September quarter following three consecutive quarters of decline. Investment levels this quarter were the highest on record,” Keenan said.

Government consumption increased by 1.4%, supported by social benefits such as energy cost reduction rebates.

Household spending stagnates

Household spending was flat in the quarter, following a 0.3% decline in June. Electricity and gas spending fell by 16.7% due to energy rebates, but essential spending such as rent, health care, and education services increased. Disposable income increased by 1.5%, supported by the third stage tax cut, which reduced household income tax payments by 3.8%. The household savings rate rose to 3.2%.

Trade and labor markets are stable

Net trade contributed slightly to GDP growth as exports of goods increased by 0.9% and imports decreased by 1.5%. However, trade in services deteriorated as fewer international students arrived and more Australians traveled overseas, particularly to Europe and Asia.

Despite the continued decline in job openings, the labor market remained strong, with low unemployment and high participation levels.

Inflation eases and wages fall

Annual inflation fell to 2.8%, the lowest level since 2021. Goods inflation fell sharply to 1.4% due to falling electricity and fuel prices, but services inflation remained high at 4.6%, reflecting increases in rent and insurance premiums. Wage growth slowed to 3.5% as the minimum wage increase was smaller than in 2023.

Economic challenges continue

GDP per capita fell by 0.3% for the seventh consecutive quarter, highlighting continued pressure on living standards. Export prices have fallen due to a decline in global demand for primary products, and terms of trade (the ratio of export prices to import prices) have also fallen for three consecutive quarters.