Australia’s economy expands faster than expected

Australia’s economy strengthened last year supported by consumer and government spending, data showed Wednesday, with the better-than-expected figures raising hopes the resources-dependent nation is emerging out of a recent slump.

Economic growth expanded by 0.6 percent in October to December to take the annual rate of expansion to a surprise 3.0 percent, figures released by the Australian Bureau of Statistics showed.

The figures beat market expectations of fourth-quarter growth of 0.4 percent for year-on-year growth of 2.5 percent, and sent the Australian dollar jumping almost half a cent to 72.19 US cents.

“Today’s December quarter national accounts show once again that Australia continues to successfully manage the transition from the largest resources investment boom in our history to broader-based growth,” Treasurer Scott Morrison told reporters in Canberra.

“We are growing faster than every economy in the G7, growing well above the OECD average. We are growing faster than the United States and the United Kingdom, more than twice the pace of comparable resource-based economies like Canada.”

The healthy figures were further supported by an upwards revision of the September quarter growth rate from 0.9 percent to 1.1 percent, the strongest three-month reading since March 2012.

Household spending contributed 0.4 percentage points to the December quarter growth while public gross fixed capital formation — which includes construction and infrastructure spending — added 0.2 percentage points to GDP, the data showed.

The gains were offset by a fall in business spending, which weakened the quarterly growth reading by 0.2 percentage points, as investment in the mining sector continued to soften.