Official data showed on Wednesday Australia's economy grew just 0.2 percent in the final quarter of 2023 as cost-of-living pressures weighed on Australian households.
The Australian Bureau of Statistics said growth reached 1.5 percent in the calendar year, driven only by government spending.
Household spending rose just 0.1 percent in the December quarter as spending on food and utilities stalled amid an ongoing cost-of-living crisis.
“The key question remains the weakness of household consumption,” economists at the National Australia Bank said, adding that the country recorded the slowest annual growth in household spending “in almost 40 years,” not counting the Covid pandemic years and the 2008 financial crisis .
Treasurer Jim Chalmers said even a slight improvement in GDP would be welcome.
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“Australia's growth is subdued but relatively stable amid higher interest rates, high but moderate inflation and ongoing global economic uncertainty,” Chalmers said in a statement.
“Even weak growth is welcome growth in these circumstances,” he added.
Chalmers said around a quarter of G20 economies were struggling with or had just avoided a recession.
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Australians were earning more and keeping more of their income, which would be helped by three upcoming tax cuts, he said.
However, the Treasurer also highlighted the economic pressures facing many people as prices for essential goods and services remain high.
“We recognize that many people and small businesses are still struggling and we see the impact in this continued pressure on the cost of living,” he said.
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