As per the official data released today, the Australian economy has reported the slowest economic growth at just 1.4% in a year to June. In the April to June period, the economy witnessed just 0.4% growth on the back of government spending as well as mining exports.
"The external sector drove GDP growth this quarter, while growth in the domestic economy remains steady," chief economist Bruce Hockman said.
Since the global financial meltdown, the Australian economy had been on track but the numbers released today paint a grim picture when the continent managed to avoid a recessionary situation in 28 years.
A slump in the housing segment, as well as the subdued level of consumer spending, has led the interest rates to a record low of just 1%. Nonetheless, in order to spur the economy, the rates can be further cut in the coming months.
"It is reasonable to expect that an extended period of low-interest rates will be required," Reserve Bank of Australia chief Philip Lowe said.