Australian economy grows 1 percent in third quarter

SYDNEY / BRASILIA

REUTERS photo

Australia’s economy posted a second consecutive quarter of strong growth, bolstered by a booming mining industry. The Australian Bureau of Statistics said yesterday that the nation’s gross domestic product (GDP) rose by 1 percent in the three months to Sept. 30 from the previous quarter. That follows revised growth of 1.4 percent in the June quarter.

Construction and mining were major contributors to the growth, officials said. Quoting Treasurer Wayne Swan, the Associated Press said the result was “exceptional,” given the fragile state of the global economy and the ongoing debt crisis in Europe.

However, economists pointed toward headwinds to future growth. “Housing construction remains patchy and net exports were a major drag, [subtracting] 0.6 percentage point [from overall growth],” said Westpac analysts in a note to investors. “The high [Australian dollar] is a negative and much of business investment is sourced from imports. Business inventories have been volatile. They subtracted 1.1 percentage point from third quarter growth.”

According to Westpac economists, the most striking aspect of the figures was the “wedge opening up” between mining and non-mining states.

“Whereas the former posted a 5.4 percent jump in demand ... the latter recorded a combined 0.1 percent gain in the third quarter with growth now just 1.3 percent annually, down from 4.4 percent a year ago,” said the economists.

On Tuesday, Brazil said economic growth stalled in the third quarter. The statistics bureau said the economy posted only 0.1 percent GDP growth between the second and third quarters. Compared to the third quarter of 2010, the economy grew by 2.1 percent.