How did Australia escape recession?
Australia is the only major Western economy to have avoided recession. So what's the secret of its resilience?
Australia is the only major Western economy to have avoided recession, defined as two successive quarters of negative growth. GDP accelerated in the second quarter, notching up a rise of 0.6%, three times higher than expected. This follows a 0.4% increase between January and March, taking growth out of negative territory after just one quarter.
What the commentators said
Australia has also been shielded by a "non-dysfunctional banking system" that steered clear of risk.
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Most important of all are its trading links with China. "As China's preferred supplier of rocks and crops" it has "piggybacked off a stimulus nine times larger than its own". With inflation unlikely to stay below target for long as the economy strengthens, said Capital Economics, Australia could hike rates by the end of the year.
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