Australia's GDP rises 0.2% QoQ, 2.1% YoY in Q3 2023; growth to slow

13 Dec '23

2 min read

Insights

Australia's GDP rose by 0.2 per cent quarter on quarter (QoQ) and 2.1 per cent year on year (YoY) in 2023 third quarter (Q3).
A clear further slowing in both domestic final demand and GDP growth is evident, the NAB Group noted.
Productivity rebounded somewhat in Q3 2023, but doesn't paint a picture of strength.
Export volumes fell by 0.7 per cent QoQ in Q3.

Australia’s gross domestic product (GDP) rose by a weaker-than-expected 0.2 per cent quarter on quarter (QoQ) and 2.1 per cent year on year (YoY) in the third quarter (Q3) this year.

A clear further slowing in both domestic final demand and GDP growth is evident, according to the NAB Group.

Household consumption was flat in Q3 and looks to have remained somewhat resilient despite the very significant headwinds to disposable income growth from higher rates, taxes and inflation.

Price and labour costs growth remains very strong. Consumption deflator growth accelerated to 1.5 per cent QoQ.

Average earnings per hour grew strongly in the quarter, NAB said in a note.

Productivity rebounded somewhat in Q3 2023, but doesn’t paint a picture of strength, still well short of the Royal Bank of Australia’s (RBA) assumed 1-per cent trend rate per year. Rather it suggests that the weakness in productivity over recent quarters has been overstated, NAB noted.

NAB continues to see the RBA lifting rates to 4.6 per cent in February before remaining on hold until late 2024.

Net exports detracted by 0.6 percentage points (pp) from quarterly GDP growth. Export volumes fell by 0.7 per cent QoQ in Q3, driven by a 4.7-per cent fall in resource exports. In contrast, rural export volumes jumped by 12 per cent QoQ.

Fibre2Fashion News Desk (DS)

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