Fed: Economy grows 4.2 per cent in year to September

AAP General News (Australia)
12-13-2000
Fed: Economy grows 4.2 per cent in year to September

CANBERRA, Dec 13 AAP - Australia's economy continued its record-breaking run in the
year to September, with growth again exceeding four per cent.

However, there were clear signs the economy was slowing, with growth in the quarter
of just 0.6 per cent, seasonally adjusted.

That was well down on the 1.0 per cent growth in the previous quarter, and slowed annual
growth from 4.9 per cent at the end of June, to 4.2 per cent in September.

Were it not for the boom in exports, the economy may have even gone backwards, with
the slump in housing and the slowing domestic economy cutting sharply into growth.

Exports alone lifted growth by 0.8 percentage points.

This is exactly the scenario predicted by Treasurer Peter Costello in the May Budget,
but the fear now is that economy may be slowing too far.

Figures released since the September quarter have shown the worst fall in employment
since the recession and falls in business confidence and home lending.

That could see the economy going backwards in the December quarter.

But the good news is the confirmation today that growth is slowing further increases
the chances of an early interest rate cut.

AAP ss/daw/wasc

KEYWORD: ECONOMY

2000 AAP Information Services Pty Limited (AAP) or its Licensors.