Australia: Drought challenge

A pick-up in export volumes is likely to bring output growth gradually back up above the trend rate of over 3% by 2008, despite a decline in the terms of trade and a cooling of the business investment boom. However, growth will be held back in 2007 by the effect of a drought on the agricultural sector.
Interest rates are close to a level that should ensure inflation returns to the target over the coming year. A modest fiscal surplus should be maintained, as buoyant tax receipts related to the commodities boom will be transitory. Skill shortages have threatened to reduce growth and prompted the recent announcement of a new skills initiative. Constraints on trading water need to be removed so that scarce water moves to higher value uses.
Population (000s), 200520 329
Area (000 sq km)7 687
GDP (Billion USD), 2005672.9
Life expectancy at birth (Women, Men), 2004 83.0, 78.1
Total labour force (000s), 200510 575
Government typeIndependent Federal State, UK Monarch
Indicators% change unless otherwise indicated
GDP growth2.63.03.4
Household savings ratio-1.7-0.8-1.2
Consumer price index3.72.82.5
Unemployment rate (%)
General government financial balance
(% GDP)
Current account balance (% GDP)-5.5-5.6-5.2
Source: OECD©OECD Observer No. 258/259, December 2006

Economic data

GDP growth: -9.8% Q2/Q1 2020 2020
Consumer price inflation: 1.3% Sep 2020 annual
Trade (G20): -17.7% exp, -16.7% imp, Q2/Q1 2020
Unemployment: 7.3% Sep 2020
Last update: 10 Nov 2020

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