Australia Posts Slowest Quarterly Growth in Four Years

Australia Posts Slowest Quarterly Growth in Four Years

Australia Posts Slowest Quarterly Growth in Four Years

The FINANCIAL -- Australia posted its slowest quarterly growth in four years in the second quarter, as fading investment in the mining sector and falling export revenue continued to put a brake on the economy, according to Nasdaq.

Gross domestic product climbed by 0.2% from the first quarter and rose by 2% from a year earlier, a government report showed on September 2, the weakest quarterly performance since a 0.4% contraction in March 2011. Economists were expecting 0.4% growth from the first quarter and a 2.2% annualized increase.

In the first quarter, the economy grew by 0.9% compared with the final three months of 2014.

The slowdown was due mainly to reduced mining and construction activity, coupled with a drop in the volume and value of commodity exports.

Net exports subtracted 0.6 percentage point from GDP growth in the second quarter. However, household consumption acted as a support, growing by 0.5% as more was spent on health care, in particular.

Australia's central bank has held interest rates at a record-low 2% for some time, to help buoy struggling areas of the economy as a resources boom that has powered growth for the past decade slows. Australia has ridden one of the longest economic expansions in modern history—a run of 96 quarters without a recession, which is commonly defined as two straight quarters of economic contraction.