Australia’s Q2 GDP was worse than economists expected, growing by only 0.2% over the quarter to be up only 1.0% year-on-year:
The result missed analysts’ expectations of a 0.3% quarterly rise.
It meant that Australia’s annual GDP growth rate fell to its lowest level since December 1991, outside of the pandemic.
Australia’s population continues to grow aggressively through net overseas migration. The population increased by 0.6% in Q2, meaning that per capita GDP declined by another 0.4%:
Australia’s per capita GDP has now declined for six consecutive quarters and seven of the past eight quarters, to be down 2.0% from its peak.
The long-term trend decline in Australia’s per capita GDP is illustrated in the chart below:
The household sector is especially hurting, with household consumption per capita declining 2.4% from its December 2022 peak:
This decline in household consumption has come despite the household savings rate collapsing to only 0.6% in Q2:
In short, Australia’s per capita recession has been long and brutal, centred on the household sector.
