Australia economy rebounds in Q4, extends recession-free run
- Author: Zachary Reyes Mar 02, 2017,
Mar 02, 2017, 10:59
The improvement in the country's fortunes was driven by strong results in Australia's exports, with a robust 9.668 billion dollar increase, representing 12 percent growth for the period, while imports were also up by 1.462 billion dollars, or 2 percent.
Annualised growth was 2.4 per cent nationally, according to the Australian Bureau of Statistics.
Australia has reported its lowest current account deficit in almost 20 years on Tuesday, with exports driving the strong result for the nation.
The strong performance means Australia avoided its first recession in a quarter of a century following a surprise contraction in the third quarter.
That makes a mockery of assertions that the economy was heading for recession (after the September quarter's contraction) and claims as late as yesterday on ABC morning TV that the economy had not made the transition from the mining boom and remained too reliant on mining.
The ABS figures show that is certainly far from reality and plain wrong. Net exports contributed 0.2 percentage points. Net exports contributed 0.2 percentage points.
However Royal Bank of Canada analyst Michael Turner noted one big driver of the trade accounts turnaround, coal prices, had begun to slide already and the other, iron ore prices, would eventually do the same.
Nominal GDP grew at a rate of 3 per cent in the fourth quarter - the strongest rise since June 2010.
The local dollar rose a fifth of a US cent after the Australian Bureau of Statistics reported gross domestic product (GDP) climbed 1.1 percent in the fourth quarter.
Mr Oliver added: "Growth should probably get back to 2.5%, maybe 3% over the course of this year". Third-quarter GDP wasn't revised from an intially reported fall of 0.5%. "The strength in commodity prices helped drive a 16.5 per cent increase in Private non-financial corporation's Gross operating surplus", the ABS said".
The non-oil sector contracted by 0.3 percent in the three months through December, and by 0.2 percent in 2016.
GDP has bounced back from a poor showing in the September quarter with December quarter seasonally adjusted growth of 1.1 per cent, while Western Australia snapped a five quarter streak of shrinking state demand to grow 0.4 per cent.
Compensation of employees decreased 0.5 percent, but was 1.5 percent higher through the year.