Third quarter GDP was up 0.9% q/q for a 2.5% increase over the year on the back of strong net exports data (as released yesterday). Net Exports contributed 1.5 ppts to growth while the big drag was capital formation (both public and private) which combined to knock 1.1 ppts off. The other major growth contributor was household consumption which added 0.4 ppts.
Although the numbers were slightly higher than the market had been expecting (before yesterday’s news about exports) growth remains well below the long term average. Household savings remain relatively stable with the savings rate at 9%; it has now been between 9-10% for more than 2 years.
In Queensland we saw another fall in State Final Demand; down 0.2% q/q, which is the 5th consecutive quarter of declines. On an annual basis the rate of decline has slowed to 2.5% (the best in a year) although this too is the 5th consecutive quarter of falls.