Why Australia’s extraordinary Covid recovery is BAD news if you are a home borrower
- Australia’s economy surged by a very strong 3.1 per cent in December quarter
- This followed 3.4 per cent pace in September quarter – strongest since 1976
- Extraordinary economic growth has sparked fears interest rates will rise
Australia’s economic growth has continued to surge sparking fears interest rates won’t be able to remain at record lows for long.
National gross domestic product soared by 3.1 per cent in the December quarter.
This followed a 3.4 per cent increase in the September quarter, which itself was the fastest economic expansion since early 1976.
The 6.5 per cent expansion in the second half of 2020 is the fastest six-month pace of growth since the Australian Bureau of Statistics began compiling quarterly national accounts data in 1959.
Australia’s economic growth has continued to surge sparking fears interest rates won’t be able to remain at record lows. National gross domestic product soared by 3.1 per cent in the December quarter. Pictured are shoppers at Melbourne’s Bourke Street Mall in November
The turbocharged growth has almost made up for the 7 per cent plunge in during the June quarter, which was the steepest quarterly decline since the 1930s Great Depression.
Australia also plunged into recession for the first time since 1991, with the economy shrinking by 0.3 per cent in the March quarter following the summer bushfires.
The Covid shutdowns caused unemployment to rise to levels unseen since the late 1990s, and led to the Reserve Bank of Australia slashing interest rates to a record low of 0.1 per cent.