Economics - Australia Gdp

Executive Summary

This Business report describes key indicators of the GDP of Australia and explains the factors that impact the GDP. It depicts the statistics and data for consumer expenditure, Business Investment, Government expenses, Export and Import. The report then discusses about the depreciation in Australian Dollar and Inflation in current economic conditions. It also elaborates on the current employment conditions and further portrays a forecast on cash rate movement. It describes that consumer spending has increased, however consumer confidence is low. It further highlights the decrease in business confidence and business Investment. While government expenditure along with the Export and Import have increased, the depreciating Australian Dollar is compelling the government to increase the export and reduce the imports. The government is trying to keep the cash rate stable because of Inflation in the prices. The report concludes that the government of Australia is trying to keep a steady cash rate in order to control the inflation and maintain a healthy economic growth.

Introduction

Economic development is measured by a percentage of annual increase in goods and services manufactured in a country. In the recent past, the Australian government has tried to achieve an internal as well external balance to sustain economic growth in the country in order to maintain inflation at low level as well as trying to reduce foreign debts. An economic growth is greatly reliant on international business cycles, not only on internal factors.

These fluctuations and variances in the economic cycle is tried to be kept under control by the government by influencing demand. There has been a shift in investments and investments in mining sector have reduced drastically. This happens when the economy is declining.

In this report we have described about the current economic conditions of the Australian government, the factors that are affecting the economy, and forecast on cash rate movements. In a nutshell, we have summarized about the Australian economy and forecasted on the cash rate movements.

Consumer Spending

Consumer spending in Australia is reported to have a steady increase of 0.5 %. It increased to 220913 Million Australian Dollars in July 2015.  In the first quarter of 2015 consumer spending was reported as 219854 AUD Million. It reached an all-time maximum in July 2015. The average consumer spending from 1959 to 2015 in Australia is 103598.74 AUD Million (Trading economics 2015).

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Consumer Confidence dropped to 93.90 in the month of September by 5.6 % as compared to August 2015. In August Consumer Confidence was stated to be 99.50 (Westpac Banking Corporation). The index resonates estimation of the financial situation of the consumer’s household in the past years and the future, projected economic conditions in the future and the next five years and purchasing conditions for key domestic items. A score below 100 points out a pessimistic view (Trading economics 2015).