The Australian economy has suffered a unexpected slowdown, after declines in construction and business spending.
Gross domestic product expanded by just 0.3 per cent in the September quarter, after a rise of 0.5 per cent in the June quarter.
This took economic growth in the 12 months to September to 2.7 per cent.
The result was well below forecasts of 0.7 per cent for the quarter and 3.1 per cent for the year.
A drop in non-residential construction was the main driver of the softer-than-expected figures, JP Morgan economist Tom Kennedy said.
“Non-dwelling construction took off 0.6 per cent and that was clearly the biggest drag and that was a bit of a surprise to us,” he said.
“Private capital expenditure is the key drag here and is the big reason why we got the downside surprise.
“Non-mining is picking up in a broad sense but it hasn’t really picked up sufficiently, it seems, to really offset the weakness in the resources sector.”
