In the three months to March, the largest contribution to growth came from exports (0.5 percentage points), followed by government spending (0.3 pp), household consumption (0.2 pp) and non-dwelling construction (0.1 pp). In addition, changes in inventories added 0.2 percentage points to growth.
Exports of goods and services rose by 2.4 percent, recovering from a 1.5 percent fall in the prior quarter. Sales of goods increased by 2.9 percent, with non-rural exports rising 3.3 percent. Exports of services went up 0.7 percent. Imports of goods and services grew by 0.5 percent, much slower than a 1.6 percent rise in the previous period. Purchases of goods rose 1.3 percent, mainly driven by a rise in capital goods (4.3 pct).
Final consumption expenditure rose 0.6 percent, after a 1.3 pecent rise in Q4. Household spending increased 0.3 percent, driven by insurance and other financial services (0.7 pct), food (0.5 pct), and electricity, gas and other fuels (2.3 pct). Government spending rose by 1.6 percent, compared to a 2.2 percent gain in Q4. The rise was mainly due to state and local government (1.4 pct )and national government (1.7 pct).
Gross fixed capital formation expanded 0.5 percent (from -0.9 percent in Q4). Private investment went up 1.2 percent, due to non-dwelling construction (1.6 pct). Also, increases were seen in dwellings (0.9 pct) and machinery and equipment (1.1 pct). In contrast, public investment declined 2 percent, driven by state and local general government (-2.2 pct). Both the private and public sector were impacted by the transfer of an asset from the previous quarter.
Total inventories increased AUD 1.2 billion following a rise of AUD 390 million in the prior quarter. The increase was driven by a build up in wholesale trade inventories, which exhibited its largest rise in over five years. Partially offsetting the rise was retail rade and mining.
By industry, mining rose 2.9 percent, driven by oil and gas extraction (8.4 pct), coal mining (2.9 pct) and iron ore mining (0.5 pct). This quarter featured the biggest rise in coal mining since Q3 2014, due to strong demand for thermal coal. Also, wholesale trade grew by 1.2 percent, driven by a rise in other goods and grocery, liquor and tobacco product wholesaling. Financial and insurance services increased by 0.6 percent, supported by a rise in other financial and insurance services (1.8 pct). At the same time, healthcare and social assistance advanced 2.1 percent, driven by rises in both private and public health. Administrative and support services went up 3 percent, the most since the December quarter 2010, driven by a rise in specialised services to businesses. In addition, professional, scientific and technical services expanded 0.8 percent, the tenth straight quarter of growth, mainly due to a rise in other professional, scientific and technical services (2.5 pct).
On the other hand, agriculture fell 1.7 percent, the fourth straight quarterly drop. Also, output declined for: construction (-0.7 percent), due to falls in building construction (-0.6 pct) and construction services (-1.7 pct); information, media and telecommunications (-0.4 percent), driven by telecommunications services (-0.5 pct) and other information and media services (-0.3 pct); and electricity, gas, water and waste services (-0.1 pct).
Through the year to the first quarter, the economy grew 3.1 percent, following a 2.4 percent expansion in the prior quarter and above expectations of a 2.8 percent growth. It is the fastest annual growth rate since Q2 2016.