Australia's economy maintained momentum in the three months through June driven by strong export demand for goods and services, suggesting a still-solid impulse in the face of 12 interest-rate increases.
Gross domestic product advanced 0.4% from the prior quarter, in line with economists' estimates, Australian Bureau of Statistics data showed Wednesday. From a year earlier, the economy grew 2.1% from an upwardly revised 2.4%.
The result will bolster the Reserve Bank's confidence that it can bring the economy in for a soft landing as it cools inflation. Policymakers anticipate a slowdown in response to their 4 percentage points of rate hikes since May 2022 while a housing crisis in China -- the biggest buyer of Australian goods and services -- is likely to reinforce that.
The Australian dollar and government bond yields were little changed immediately after the release.
Despite the solid headline number, Australia's expansion will probably weaken from here. For one, there is growing uncertainty around China's economic outlook; and secondly, Australian households are already facing a squeeze with Wednesday's data showing their savings ratio declined to 3.2% from a downwardly revised 3.6% three months earlier.
Source : Bloomberg
