Australian national accounts – a fragile state
Yesterday’s Australian Bureau of Statistics – Australian National Accounts – for the March-quarter 2014, shows that real GDP growth was 1.1 per cent, up from 0.8 per cent in the December-quarter 2013. The annualised growth rate of 3.2 per cent is an improvement on the 2.8 per cent from last quarter and is close to the trend rate between 2000 and 2008 of 3.3 per cent. Growth is being driven almost exclusively by Net exports with some help from household consumption and private investment, although the last two components are fairly subdued. The question is whether the boom in net exports in the Mining secotr in the March-quarter 2014 can be maintained. The signs are that it will taper somewhat in the second-quarter results given that the terms of trade are falling significantly and the export volumes that have been driven by strong growth in China are likely to decline as the Chinese economy slows. Overall, the data paints a fairly fragile picture for the Australian economy with not much sign of activity in the non-Mining sectors.