Australia’s economy logs weakest growth since financial crisis

Business | 5 Jun 2019 11:34 am

Australia’s economy expanded at the slowest pace in almost a decade as a prolonged housing downturn weighed on consumer spending, underscoring the central bank’s decision to lower interest rates, Bloomberg reports.

Gross domestic product advanced by 0.4 percent in the first three months of the year from the previous quarter, statistics bureau data showed in Sydney.

The economy grew by just 1.8 percent from a year earlier, the weakest reading since the global financial crisis, as households boosted their savings and cut spending in a classic response to wealth erosion.

“The data confirm that the economy started 2019 very softly,” said Sarah Hunter, head of macroeconomics at BIS Oxford Economics in Sydney. “Consumers continue to be battered by weak income growth, and this was added to by the drag from sharply falling house prices.” The currency was little changed after the GDP release.

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