2019.03.0520:30:00UTC+00Australia Q4 GDP Advances 0.2% On Quarter

Australia's gross domestic product added a seasonally adjusted 0.2 percent on quarter in the fourth quarter of 2018, the Australian Bureau of Statistics said on Wednesday.

That was shy of expectations for an increase of 0.5 percent following the 0.3 percent gain in the three months prior.

On an annualized basis, GSP was up 2.3 percent - again missing forecasts for 2.6 percent and down from 2.8 percent in the previous quarter.

"Growth in the economy was subdued, reflecting soft household spending and a decline in dwelling investment," ABS Chief Economist Bruce Hockman said. "The approvals for dwelling construction indicate that the decline in dwelling investment will continue."

Household spending grew 0.4 percent, reflecting a continuation of modest spending in recent quarters. Investment in dwellings fell 3.4 percent.

Falls in private investment dampened growth in the quarter. This was consistent with the decline in construction industry value added, falling 1.9 percent. Services industries supporting construction activity detracted from growth with professional scientific and technical services industry value added declining for the first time in three years.

Mining investment fell in the quarter as significant projects transitioned from the construction to the production phase. This is reflected in oil and gas production, which grew 7.7 percent.

Public demand sustained growth in the quarter. Public investment remained at high levels with State and Local government growth of 6.3 per cent reflecting continued work on a number of large infrastructure projects.

Government final consumption expenditure grew 1.8 percent, with ongoing expenditure in health, aged care and disability services. This investment translates to ongoing strength from the healthcare industry, which remains the largest contributor to economic growth.

Terms of trade rose 3.1 percent.

"As the economy transitions out of the mining boom, investment has remained strong with major public works driving growth around Australia," Hockman said.