The latest GDP figures show that the Reserve Bank has slowed things down so drastically that Australia’s economy, for the first time for 40 years, has gone an entire year where it grew only because of population increases.
There really is no good news to find in the December GDP figures. There’s a fair bit of “worst since” about the numbers.
Take the overall calendar year. In 2023 Australia produced just 2.0% more than it did in 2022. That is the worst since the lockdown year of 2020 and just the fourth time since the 1990s recession that we did not produce over 2% more than we did the previous year:
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On a per capita basis things were truly bad. 2023 was only the third time in the past 40 years that our economy was smaller when accounting for population growth than it had been the year before.
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This is not indicative of things going well. It’s indicative of an economy that has been slowed to a halt by the Reserve Bank.
We generally don’t look at total year growth, we focus more on quarterly growth. When we take into account population, Australia’s economy shrunk 0.3% in the December quarter. This was off the back of a 0.5% fall in the September quarter and a 0.2% fall in the June quarter. In the March quarter of last year it didn’t fall. But it didn’t grow either – growth was 0.0%.
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But........