Name: Australia’s GDP expands in Q3, but by less than expected
Uploaded: 2025-12-03T06:25:28.523Z
Duration: 1 min 56 s
Description: Australia’s economy grew 0.4% in the September quarter, lifting annual GDP to 2.1%—below the forecast 0.7% and prompting concern among economists. Treasurer Jim Chalmers highlighted stronger private investment, particularly in data centres, as a sign of resilience despite slowing momentum.

Australia’s economy grew 0.4% in the September quarter, lifting annual GDP to 2.1%—below the forecast 0.7% and prompting concern among economists. Treasurer Jim Chalmers highlighted stronger private investment, particularly in data centres, as a sign of resilience despite slowing momentum.

Canberra

Australia's economy recorded a 0.4% increase in GDP for the September quarter, resulting in an annual growth rate of 2.1%. This figure was below the expected 0.7% quarterly growth, leading to disappointment among economists, though the Treasurer highlighted increased private investment, especially in data centres, as a positive sign.

Government spending also rose by 3%, prompting concerns about inflation, which reached 3.8% in October and is not forecast to return to the target range of 2-3% until 2027. The Reserve Bank of Australia acknowledged more work is needed to control inflation, while national accounts revealed higher spending on essentials and increased savings, reflecting public caution. Experts suggest the central bank may keep interest rates unchanged in the near future.

Australia’s GDP expands in Q3, but by less than expected

Interpreting economic data is often in the eye of the beholder. And for many economists, a 0.4% rise in GDP in the September quarter, meaning an annual growth rate of 2.1%, is a bit of a miss. It's disappointing. I don't think there's any other way to say it. The expectation for the quarter was for 0.7% of 1% growth. But for the Treasurer, these are welcome numbers, particularly a jump in private investment in the third quarter, with money flowing into data centres. The story here is about the engines of private sector growth firing up. But while business spending rose, so too did public funding, with investments by governments growing by 3%. We've been saying this now for months. The government has to stop its spending spree. The more money being pumped into the economy, the greater the risks of higher costs and inflation, which spiked to 3.8% in October, and is not forecast to come back to the midpoints of the board's target range of between 2% to 3% until 2027. Speaking to a Senate estimates hearing before the GDP figures were released today, Governor Michelle Bullock admitted there's more work to do. That is the whole purpose of the board, to try and bring it back sustainably. Have we done it yet? No, we haven't done it yet. So we need to keep working on this. The national accounts figures also reveal we're spending more on essentials, like insurance, electricity and health, but less on discretionary goods, such as entertainment and travel. And we're saving more, signs the public is concerned about the state of the economy. As for what it all means for interest rates... In the next six to 12 months, it's very probable the RBA will actually do what it did through 2015 to 17, which is do nothing and allow the economy to actually ride itself without intervention. Perhaps the best data homeowners can hope for. Harvey Biggs, 10 News.

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