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New data from the Australian Bureau of Statistics’ national accounts confirmed weak growth – the lowest quarterly figures since September 2021 – when the economy pulled back.
“GDP growth was weak in March, with the economy posting its slowest annual growth since December 2020,” said ABS head of national accounts Catherine Keenan.
“GDP per capita fell for the fifth consecutive quarter, falling 0.4% in March and 1.3% on the year.”
Economists had expected either very little or no growth, with Reserve Bank Governor Michelle Bullock telling Senate Estimates earlier today that she did not expect GDP to increase.
”I would say we are in a position where the economy is very weak,” she said.
“We have … people cutting discretionary spending, but we still have growth in the labor market, and that’s a very important point to remember — that the unemployment rate is rising gradually, but employment continues to rise.”
In a clear sign that Australians are struggling, households saved an average of just 0.9 per cent of their income in the March quarter – down from 1.6 per cent in December – even though wages rose.
That means savings have remained below 2 percent for a full year for the first time since March 2008, during the global financial crisis.
“Household earned income grew at its slowest pace since December 2021, reflecting relatively small increases in employee compensation and investment income received this quarter,” Keenan said.
“Compared to the last quarter, the rise in income tax payable did not reduce the total income paid by households as much, resulting in a lower household saving rate.”
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