Growth figures spark sharp Aussie dollar fall

THE Aussie dollar has experienced a sharp drop after new figures for the year and the quarter showed smaller than expected economic growth.

The Aussie dollar has dropped after the economic growth figures were released. Picture: iStock

THE Aussie dollar has experienced a sharp drop this morning after economic growth figures for the year to September were released.

Economic growth figures were published at 11.30am, which showed lower than expected growth for the 12 months to September.

The Australian dollar dropped sharply on the result, from 76.13 US cents before the 11.30am release to 75.84 US cents two minutes later.

The economy was expected to grow by 0.7 per cent in the quarter and 3.0 per cent over the 12 months to September.

But Australian Bureau of Statistics data showed Australia’s economy expanded 0.6 per cent in the September quarter and grew 2.8 per cent over the year.

Treasurer Scott Morrison said the figures indicated “solid” economic growth, however, with growth accelerating from 1.9 per cent to 2.8 per cent through the year.

“This is above the OECD average and puts Australia back up towards the top of the pack for major advanced economies around the world,” Mr Morrison told reporters in Canberra today.

Household consumption figures also revealed Australians were saving more than they had been in past months, with the household “saving ratio” up 0.2 per cent since the June quarter.

Growth in household spending is now at its lowest rate since the March quarter in 2005.

Aussies were cutting back spending on household furnishings and equipment, hotels, cafes and restaurants, clothing and footwear and buying new cars.

Meanwhile, spending on electricity, gas and other fuels went up 11.5 per cent and cigarettes and tobacco went up 11.1 per cent.

Treasurer Morrison said the figures weren’t surprising given the cost of living pressures on essentials that Australians were feeling and had been feeling for some time.

Mr Morrison highlighted strong jobs growth as one of the most positive signs in the economic figures.

“This government’s strategy has supported jobs by driving investment that in the September quarter created more than 1000 jobs every day,” he said.

Originally published as Growth figures spark sharp Aussie dollar fall