8 Dec 2011

Australian economy still expanding

7:38 am on 8 December 2011

Australia's economy has continued to expand, boosted by business investment and consumer spending.

Official figures show seasonally adjusted gross domestic product expanded 1% in the three months to September.

Business spending jumped, mainly due to strong gains in engineering construction and mining, while household spending rose, which offset a weaker housing market and lower government investment.

On an annual basis, the economy grew 2.5%.

Australia's growth is much better than Europe and the United States, but economists are picking further interest rate cuts because of the turmoil in Europe and slowing global growth.

But economists note the growth partly reflects he continuing recovery from the floods at the beginning of the year that led the economy to contract.

And they say that outside of mining in Western Australia and Queensland, the Australian economy was pretty soft.