The second quarter GDP data released today shows q/q growth of 0.5% (seasonally adjusted) or 1.4% for the year (down from a revised 1.7% the previous quarter. This result is broadly in-line with market expectations and comes on the back of continued weak household consumption (which sees household savings fall to their lowest rate in 11 1/2 years) and declines in private sector investment. The Trend series showed a 0.4% q/q increase or a year-on-year rate of 1.5%.
In Queensland State Final Demand data (which does not include the external side of the economy) was up 0.3% q/q or 0.9% for the year (Trend data). There has been downward revision to the ABS Q1 data which brings the State Final Demand much more into line with the Queensland Treasury data released yesterday (see here for commentary on this little-reported Treasury data). The Treasury estimated Q1 Gross State Expenditure up 1.1% y/y and Gross State Product slowing to 1.9% y/y. Today’s Q2 data suggests the Treasury data for Gross State Product will struggle to rebound from these low levels. Seasonally adjusted data shows a very slight decline in State Final Demand for the quarter at -0.04%.
Private investment continues to be the biggest drag on the State numbers with Private sector capital formation falling 1.9% q/q (the 5th such fall). For the fourth quarter in a row total Private sector demand fell (by 0.05% q/q); the limited growth in the domestic side of Queensland’s economy is all coming from the Public sector where consumption was up 1.6% and CAPEX up 0.7% q/q.