Growth Star From Afar, Australian Economy Falters Under Scrutiny
- Annual GDP expansion clocks up the fastest pace in four years
- More than half of growth came from resource exports: Macquarie
Australia 2Q GDP 0.5% on Quarter
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Australia appears a shining light in an otherwise fairly moribund developed-world economy, from glancing at its latest GDP report. But that image falters under scrutiny as the country’s powerful expansion fails to generate equivalent jobs gains and dent excess capacity.
The Reserve Bank of Australia’s actions tell us so: it’s been forecasting strengthening growth and at the same time cut interest rates twice in four months to a record-low 1.5 percent; it’s also pointed out that the traditional connection between certain levels of growth and labor-market outcomes no longer holds. Australia’s growth isn’t quite jobless, but it’s not far off.