Australia's Q2 GDP grows 0.6% quarter-on-quarter, with household consumption as the main growth driver

According to data from the Australian Bureau of Statistics, the Gross Domestic Product (GDP) grew by 0.6% quarter-on-quarter in the second quarter, with a year-on-year growth rate of 1.8%, mainly driven by a strong rebound in household consumption. Paul Bloxham, Chief Economist at HSBC, pointed out that although productivity improved slightly during the quarter, the current economic operation is already approaching its capacity limit.

Bloxham predicts that Australia’s potential GDP growth rate in 2025 will be between 1.75% and 2.0%. He specifically emphasized that in the context of accelerating economic growth and capacity nearing saturation, “it is difficult for us to foresee new downward drivers for inflation—which is a necessary condition for the central bank to implement further interest rate cuts.” The tension between this economic growth momentum and the space for monetary policy is becoming a focal point of market attention.