Australia Expands at Fastest Pace Since 2007 on Exports: EconomyAustralia’s economy expanded in 2012 at the fastest pace in five years as resource investment and exports outweighed subdued manufacturing and construction.
Gross domestic product grew 3.6 percent last year, the best performance since a 4.7 percent expansion in 2007, data from the Australian Bureau of Statistics compiled by Bloomberg showed. The economy grew 0.6 percent in the fourth quarter from the previous three months, when it rose a revised 0.7 percent that was higher than initially reported, today’s report showed.
Stocks and the currency rose as stronger exports validated Reserve Bank of Australia Governor Glenn Stevens’s decision to leave interest rates unchanged yesterday as the nation extends 21 recession-free years. Policy makers cut rates by 1.75 percentage points in the 14 months through December to rebalance an economy where mining regions in the north and west thrive while builders and manufacturers in the south and east struggle, dragged by the strength of the nation’s currency.
“The broad picture is one of an economy in better shape than many commentators give credit,” said Michael Blythe, chief economist in Sydney at Commonwealth Bank of Australia (CBA), the nation’s biggest lender. “Despite all the economic dramas and general pessimism, the growth outcome actually beat the consensus forecast.”
The nation’s benchmark S&P/ASX 200 Index climbed 1 percent today and the local dollar traded at $1.0293 at 2:10 p.m. in Sydney from $1.0264 before the release, extending its longest stretch above parity with the U.S. dollar. The three-year government bond yield held gains, rising 8 basis points to 2.85 percent.