Australian Economy Shrinks for First Time Since 2011

Australia’s economy shrunk by 0.5 % in the latest quarter, marking its first fall since 2011, according to official figures published by the Australian Bureau of Statistics on Wednesday. The fall of 0.5 % in the July to September quarter was worse than…

Australia's economy shrunk by 0.5 % in the latest quarter, marking its first fall since 2011, according to official figures published by the Australian Bureau of Statistics on Wednesday.

The fall of 0.5 % in the July to September quarter was worse than the most pessimistic forecasts by economists, local broadcaster (ABC) said.

The drop dragged down Australia's annual rate of growth in gross domestic product from an expected 2.2% to 1.8%.

The Bureau said declines in building activity of 3.6% and a fall in net exports were the main causes of the negative result in this year's third quarter.

It is the first negative quarter Australia has experienced since March 2011 when floods hit the state of Queensland, halting much of Australia's coal production.

During the global financial crisis the Australian economy shrank 0.7% in the final quarter of 2008.

Treasurer Scott Morrison told reporters in Canberra the figures were "a wake up call" showing the need to support government economic policies that "drive the investment needed to support job security." Morrison said Australian economic growth was still higher than six out of seven G7 economies, second only to the UK but higher than the US, Germany, Canada, Japan and higher than the OECD average.

Opposition treasury spokesman Chris Bowen said it was the second worst economic growth result in the last 25 years.

Source: Qatar News Agency