Australia economy slows in Q4 as headwinds mount

AUSTRALIA’S economy grew at the weakest pace in a year last quarter as strength in trade was offset by rising interest rates and high inflation, and all the signs are a further slowdown lies ahead.

Data from the Australian Bureau of Statistics on Wednesday showed real gross domestic product (GDP) rose 0.5 per cent in the December quarter, down from 0.7 per cent in the previous quarter and under forecasts of 0.8 per cent.

Annual growth was still solid at 2.7 per cent, while the report contained plenty of evidence of cost and price pressures that underline the case for yet further increases in interest rates in the struggle against inflation. REUTERS