PERTH (miningweekly.com) - The Australian economy has completed its 27th consecutive year of economic growth, with real gross domestic product (GDP) beating median market expectations with a 0.9% increase in the June quarter.

Treasurer Josh Frydenberg said on Wednesday that the economy grew by 3.4% in through-the-year terms, which is the fastest rate of growth since the September quarter of 2012, during the height of the mining investment boom.

In year-average terms, Australia’s economy expanded by 2.9% in the 2017/18 financial year. This is above the forecast of 2.75% published in the 2018/19 Budget.

Nominal GDP grew by 4.7% on a year-average basis, also above the Budget forecast of 4.24%, as real GDP was stronger than forecast and prices for key commodities remained higher than assumed, Frydenberg said.

The strength in the June quarter was broadly based. Household consumption, dwelling investment, new public final demand and net exports all contributed to growth in the quarter. Business investment and changes in inventories made no contribution to growth. 

By industry, mining investment rose by 5.1% in the quarter, which was the first rise since the March quarter 2017. This result reflected investment in machinery and equipment by mining firms and an increase in mineral and petroleum exploration expenditure, the Treasurer said.

The Queensland Resources Council (QRC) has welcomed the new Australian Bureau of Statistics (ABS) data, saying the figures showed that the mining industry continued to underwrite the Australian economy.

QRC CEO Ian Macfarlane said the contribution of a 5.1% increase in mining investment played an important role in the overall strength of the economy.

“As we know in Queensland, when the resources sector does well, all of us do well,” Macfarlane said.

“It’s particularly pleasing to see mining investment increase 5.1%, which the ABS reports is the first rise since the March quarter last year.

“This points to the long-term strength of the resources industry, which is good news for jobs in regional Queensland communities and for the Budget bottom line.”

Macfarlane said that more investment in machinery and equipment meant more activity in resources projects, which translated directly to more royalties.

“These positive national accounts numbers follow the release of exploration figures earlier this week showing a 22% increase in exploration spending for minerals and petroleum in Queensland over the last 12 months.

“It all points to good news for the Queensland economy. But this uptick in resources investment reinforces the need for reliable and stable regulation, to ensure Australia, and Queensland in particular, can continue to attract investment in a highly competitive global environment.”