2 Dec 2010

Australian growth softer than expected

9:12 am on 2 December 2010

Australia's economic growth has fallen short of forecasts by economists, with the economy expanding by 2.7% in the 12 months to September.

Figures issued by the Australian Bureau of Statistics show growth over the third quarter came in at just 0.2%.

Growth was much stronger in the June quarter, at a revised rate of 1.1%.

The ABC reports the agricultural sector was the biggest contributor to growth in the period, growing by 21.5% and adding 0.4 percentage points to the GDP figure.

Economists say without that, the economy would have probably contracted in the three months.

Household spending also held up, but a slump in net exports was the main drag on the economy, detracting 0.4 percentage points from the quarterly figure.

The ABC reports much of Australia's growth rests on a prolonged mining boom. Demand for Australian resources from China and India is forecast to remain strong.