« Back to Publications

Vital Signs: why everyone seems a bit worse off

Richard Holden writes in The Conversation (3.6.16) about the latest release of Australia’s GDP figures, which show higher than expected economic growth. The author suggests that, despite a welcome reception from the government and some commentators, other indicators show that the national economy is actually more fragile than it appears.

‘At first blush, first quarter GDP figures for Australia, released Wednesday, seemed very positive. Growth for the quarter was 1.1%, pushing the annual rate to 3.1% – up from 2.9% as at December and ahead of market expectations of 2.8%.

‘On closer inspection the news wasn’t so good. Growth came largely from exports – accounting for fully 1 percentage point of the 1.1% growth. What’s wrong with exports? Well, nothing, except that a quirk of national accounting means that it is volume, not prices, that matter for the GDP figure. And prices of exports fell. A lot.

‘ … Overall: unclear news from overseas, strong domestic construction growth that might well reverse in coming months, GDP growth that doesn’t translate into income, and more signs of deflationary pressures.

‘Sorry, but the glass is half empty.’

The TJRyan Foundation does not guarantee the accuracy, currency or completeness of any information or material available on this website. The TJRyan Foundation reserves the right to change information or material on this website at any time without notice. Links from this site to external, non-TJRyan Foundation websites should not be construed as implying any relationship with and/or endorsement of the external site or its content by the TJR Foundation, nor any commercial relationship with the owners of any external site. Should any TJRyan research project be funded by an individual or organisation the source of funding will be stated beside the research report. In all other cases contributions are provided on a pro bono basis.
Receive the latest news

Subscribe To Our Newsletter

Get notified about new articles

This field is for validation purposes and should be left unchanged.