Australia's GDP growth rate doubled to 0.6% in the fourth quarter. The central bank remains cautious about maintaining loose monetary policy after cutting interest rates.

In the fourth quarter of 2024, the Australian economy accelerated, supporting the Reserve Bank of Australia's cautious stance on further easing policies after last month's rate cut. Official data released on Wednesday showed that Australia's GDP grew by 0.6% in the fourth quarter, in line with economists' expectations and double the rate of the third quarter. Per capita, GDP grew by 0.1% after seven consecutive quarters of decline. Compared to the same period last year, the economy grew by 1.3%, also in line with expectations. Catherine Kieran, director of national accounts at the Australian Bureau of Statistics, said in a statement, "The economy is showing moderate growth overall. Both public and private spending have driven economic growth, and the growth in exports of goods and services has also played a role." The Reserve Bank of Australia cut the cash rate by 25 basis points to 4.1% last month, citing increasing belief that inflation will return to target. However, the central bank also expects economic growth to rebound to 2.4% in December, coupled with a "continuing tight labor market" and increased risks of consumer price increases. This data will be welcomed by Australia's center-left Labor government, which trailed the opposition Liberal National Coalition in a mid-May opinion poll ahead of the election. The updated GDP forecast from the Reserve Bank of Australia is below the pre-pandemic 20-year average (close to 3%). Governor Michele Brock attributed this to relatively slow growth in consumer spending. "Consumption is rebounding, but not as strongly as we initially expected," she said after the interest rate decision on February 18. "The recovery in consumption is still quite slow, a significant driver of GDP." While growth remains below peak levels, the accelerated growth in the December quarter provides a more optimistic outlook. Australia's business environment is also quite active, with retail sales increasing in five of the six months up to January. Kieran from the Australian Bureau of Statistics said, "As people take advantage of retail promotions and increase hospitality spending due to appreciation for music and sporting events, household discretionary spending has increased accordingly."