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4h ago

Australia’s Economy Beats Forecasts in June Quarter With 0.6% Growth

A jump in household spending signaled a shift from public outlays toward private demand.

Workers walk on the streets of Sydney, Australia, September 4, 2017. REUTERS/Steven Saphore/File Photo
Numbers are displayed on a board at the Australian Securities Exchange (ASX) headquarters in Sydney, Australia, August 19, 2025. REUTERS/Hollie Adams/File Photo
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Overview

  • ABS data show GDP rose 0.6% quarter on quarter and 1.8% year on year in Q2, the fastest pace since September 2023 and above consensus expectations.
  • Household spending was the biggest driver, with non‑essential outlays up 1.4% and notable gains in recreation, furnishings, new cars, and hospitality.
  • Net trade contributed to growth as iron ore and LNG exports recovered, and a surge in inbound tourism lifted services exports 3.6%, narrowing the current account deficit to A$13.7 billion.
  • The Reserve Bank of Australia cut the cash rate to 3.6% in August as inflation eased to 2.1%, and it lowered its 2025 growth forecast to 1.7%.
  • Business investment remained muted and public investment fell, and economists warned the shift toward more capital‑intensive private activity could pressure employment.