Seasonally-adjusted GDP growth for the March quarter was 1.1 per cent, with the annual growth rate sitting at an impressive 3.1 per cent.
The Australian Bureau of Statistics (ABS) has released the National Accounts, which show the national GDP figure rose by 1.1 per cent for the March quarter and 3.1 per cent year-on-year.
Strong exports growth continued to underpin the growth in the Australian economy, contributing 1 percentage point. Household spending contributed 0.4 percentage points.
The March quarter figure of 1.1 per cent is up from 0.7 per cent in the December 2015 quarter, and is above the market expectation of 0.8 per cent.
In a briefing note on the GDP figures, NAB Economics said the continued growth is consistent with the “closing phases” of the mining boom.
“A strong contribution from net exports – bolstered by commodity production – was largely offset by sharp declines in mining investment,” said NAB.
“Household consumption made a strong contribution, despite a rise in the household savings ratio (although the trend is down), thanks to the apparent strength in services consumption."
The strong March quarter GDP figure makes a second RBA rate cut unlikely, with NAB expecting the Reserve Bank to keep the official cash rate ‘on hold’ for the remainder of 2016.
“However, we do acknowledge a further rate cut remains a possibility if inflation continues to surprise to the low side,” said NAB.
AMP Capital chief economist Shane Oliver said the March quarter year-on-year figure is “far better” than the growth seen in other advanced economies.
The US economy is currently growing at 2 per cent, and GDP growth in the eurozone and Japan is 1.5 per cent and 0.5 per cent, respectively, Mr Oliver said.
“On the growth front, Australia remains a star performer compared to other developed countries,” Mr Oliver said.