Australia’s Economic Growth Slows as Rate-Cut Bets Rise: Economy

Australia’s economy slowed last quarter on weaker housing and rising imports, sending the local currency lower as traders bet the central bank will resume interest-rate cuts to prolong a 21-year expansion.

Second-quarter gross domestic product advanced 0.6 percent from the previous three months, when it rose a revised 1.4 percent, a Bureau of Statistics report released in Sydney today showed. The median of 26 estimates in a Bloomberg News survey of economists was for a 0.7 percent gain. From a year earlier, the economy expanded 3.7 percent, the strongest annual pace since 2007 after the revised 4.4 percent growth in the first quarter.

The report showed the fastest first-half expansion in five years before companies including BHP Billiton Ltd. scaled back mining projects this quarter in response to lower prices of iron ore, the nation’s most valuable export. Reserve Bank of Australia Governor Glenn Stevens cut rates in May and June to buttress consumption as an elevated currency extended a slump in manufacturing and services.

via Bloomberg

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