Westpac with a quick response to today's GDP data from Australia

(Bolding is mine ... and the link to the data itself is at the bottom of this post)

  • Australian real output surprised to the low side
  • The key surprise was private infrastructure work, which fell by 0.8% in Q2, whereas the Construction Work Done survey reported a 10% rise
  • Temporary dip in exports ... Exports will resume their expansion in the quarter ahead, led by resources and services
  • June quarter public demand staged a one-off jump, up 2.7%, led by defence spending
  • Private demand was sluggish, up 0.2%qtr, 0.9%yr.
  • Business investment declined, down -0.7%qtr, -6.8%yr as the mining investment downturn remains a major headwind and investment across the non-mining sectors remains at low levels.
  • Home building activity also fell, down 1.1%. This represents a consolidation following a 10% surge over the past six months. Approvals point to further gains ahead.
  • Consumer spending remains lacklustre, at 0.5%qtr, 2.5%yr. Wage income weakness over the past year, notwithstanding a stronger outcome for the quarter, and a lack of confidence are constraining factors.
  • Incomes remain under intense pressure as the terms of trade declines. The terms of trade fell by 3.4% in the quarter to be 10.6% lower than a year ago, as global commodity prices tumble.
  • Nominal GDP growth was a sluggish 0.3% in the quarter and a weak 1.6% over the year. Historically, annual nominal GDP growth has been around 5.8%.

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More on the GDP here:

  • GDP responses ... "AUD to fall into low 60s"
  • Australian Q2 GDP growth - driven by government spending, household consumption
  • Australia Q2 GDP: 0.2 % q/q (vs. expected +0.4%)