Australian economy grew with 0.3% in Q3 2014, which is slower than expected pace of growth, as the declining level of public and private investment continued to weigh on the expansion of the economy. The growth of Australian gross domestic product (GDP) reached 0.3% in the third quarter from 0.5% in the previous three months, according to the National Bureau of Statistics. The median forecast of surveyed earlier analysts was for GDP growth of 0.7%.
Measured on an annual basis, the Australian economy grew by 2.7% in the three months to the end of September with expectations for expansion of 3.1%.
According the data the net exports added 0.8 percentage points to growth, while final consumption expenditure were responsible for 0.4 percentage points of economic expansion. Looking at the industry, the main growth factors were financial and insurance services, adding 0.2 percentage points. Information sector and telecommunications have they contributed 0.1 percentage points to GDP growth.
The data showed that real gross domestic income fell by 0.4% in the quarter to the end of September. The new figures support recent comments by central bankers that the economy will grow at a slower pace over the next few quarters, especially against the background of declining investment in the mining industry. On Tuesday, Australian central bank decided to keep its main interest rate a record low of 2.5% for the 16th consecutive month, and they were staff projections despite volatile economic data in recent weeks.
However, there are speculations that the institution will further reduce interest rates in the next two years to support the growth of the economy. Deutsche Bank recently changed its forecast, according creditor Australian authorities will probably shrink interest rates by 50 basis points to 2% by the end of 2016.