SYDNEY • Australia's economy hit a speed bump last quarter as bad weather lashed shipments and home building, though growth was just enough for the resource-rich nation to extend its run without a recession to almost 26 years.
Data from the Australian Bureau of Statistics yesterday showed gross domestic product (GDP) grew at annual rate of 1.7 per cent - the slowest since the third quarter of 2009 when it clocked 1.2 per cent.
The local dollar gained a third of a US cent after GDP matched expectations for a 0.3 per cent rise in the first quarter from the fourth, when it ran at 1.1 per cent.
Australia has now matched the Netherlands record for the longest economic run without a technical recession at 103 quarters.
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"The Australian economy has had to contend with a lot of factors in the past year - geopolitics, weather events, the ongoing unwinding of the mining construction boom and variable housing markets. So economic growth has trekked a zig-zag path," said Mr Craig James, chief economist at Commsec. "The hope is that employment and investment will continue to lift, maintaining economic momentum."
Australia has not seen a recession since 1991 and its run of growth has been the envy of other rich nations although it is dropping off the pack now with both Britain and the United States clocking 2 per cent annual growth in the first quarter.
Output for the 12 months to March was A$1.72 trillion (S$1.8 trillion) in current dollars, or about A$71,053 for each of Australia's 24 million people.
Growth took a knock from Cyclone Debbie, which hit northern parts of Queensland state late in March and caused widespread flooding in the coal-heavy region, disrupting rail haulage for several weeks. Negative net exports subtracted 0.7 percentage point from GDP.
The Reserve Bank of Australia on Tuesday conceded economic activity slowed in the March quarter when it held interest rates at a record low 1.5 per cent.
However, it expressed confidence that growth would pick up over the next couple of years to be above 3 per cent.
So far, investors seem convinced the central bank is done with its five-year easing campaign.