9 insights on the Australian economy in June 2024
The Australian Economy - June quarter 2024
- Our economy grew a modest 0.2 per cent in the June quarter 2024 and 1.5 per cent over the 2023-24 financial year. While this was the eleventh consecutive quarter of GDP growth, it was the sixth consecutive quarter of GDP per capita falls (total GDP divided by the population of Australia). Over the year GDP per capita fell 1.0 per cent.
- Annual inflation increased, though annual underlying inflation continued to fall. The consumer price index rose 1.0 per cent in the June quarter and was up 3.8 per cent compared to June quarter 2023. This was the first increase in annual inflation since December quarter 2022, although annual trimmed-mean inflation continued to fall. Prices were higher for goods such as new dwellings, fuel, and fruit and vegetables.
- Our wages grew. The wage price index rose 0.8 per cent in the June quarter and was up 4.1 per cent compared to June quarter 2023. Private sector wages grew by 0.7 per cent in the quarter, which was the equal lowest rise for this measure in any quarter since December quarter 2021.
- The labour market remained tight. The unemployment rate in the month of June rose slightly compared to March to sit at 4.1 per cent. The total hours we worked was up 1.1 per cent in the quarter, but was below the growth seen in June quarter 2023.
- We spent less. Household spending fell 0.2 per cent in the quarter, following a quarterly rise of 0.6 per cent in the March quarter. We spent less on discretionary items, particularly for events and travel. Spending on food also fell 1.0 per cent as we looked to reduce our grocery bills.
- Our savings remained low. Households saved only 0.9 per cent of their income over the year. This was the lowest rate of annual saving since 2006-07. Net savings reduce when household income grows slower than household spending.
- Government spent more on frontline services. Commonwealth government spending added 0.2 percentage points to economic growth in the June quarter. This was driven by more spending on government benefits for households, particularly as large government programs continued to expand for health services.
- Trade contributed to growth. Exports rose 0.5 per cent in the June quarter while imports fell 0.2 per cent. Services led the growth in exports, driven by travel service exports, which bounced back 9.9 per cent. Falls in bulk commodity prices and higher income paid to non-residents resulted in the largest current account deficit since June quarter 2018
- Capital investment dipped again. Total capital investment fell 0.1 per cent in the June quarter. Business investment in new machinery and equipment fell 1.6 per cent, driven by the agriculture and retail industries. Businesses expectations indicate that their capital investment will rise moderately next financial year.
Media notes
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