Growth exceeds RBA predictions
Figures released in June 2018 show that GDP rose 3.1 per cent, year over year, which was stronger than the RBA had predicted. The bank had said that it expected Australia’s economy to grow more strongly in 2018 and 2019 than has been the norm over recent years unless trade wars played a greater part than expected.
One pleasing feature of the national accounts was the ongoing rise in investment. Non-mining business investment increased by ten per cent from June 2017 to June 2018, boosted by benign business conditions and by increased government and state spending on infrastructure.
Over the year, household consumption increased by 2.9 per cent, aided by stronger employment growth, which in turn boosted wage-related income. Household debt remains high, and the housing markets in Sydney and Melbourne are in the midst of a period of price adjustments following previous spikes across the board.
Finance companies are tightening credit standards, which is expected to have a role in reining in any further increases to household debt.
- GDP rose 3.1 per cent year over year
- The RBA is predicting further growth in upcoming years
- Investment has continued to rise
- Household consumption increased by 2.9 per cent