Australia's gross domestic product expanded a seasonally adjusted 0.6 percent on quarter in the third quarter of 2017, the Australian Bureau of Statistics said on Wednesday.
Treasurer Scott Morrison labelled the September quarter national accounts "another encouraging set of numbers", noting that at 2.8 per cent, the annual growth figure stands above the average of other advanced economies.
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The annual pace accelerated to 2.8 percent, from 1.9 percent and handily outpaced the United States at 2.3 percent.
Australia has been exiting an unprecedented mining investment boom, with the Reserve Bank of Australia cutting interest rates to a record-low of 1.5% since November 2011 to boost growth in non-resources industries.
"The most worrying aspect of the data was the strikingly weak household consumption outcome", she said.
"We have now seen four consecutive quarters of investment growth, following 12 consecutive quarters of decline".
"The big surprise was consumer spending - looks disgusting", said Shane Oliver, chief economist at AMP Capital.
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However, consumer spending remained weak, under pressure from rising household debt and soft wages growth. Wage growth is crawling at the slowest rate ever, while the unemployment rate is still up around 5.5 percent. But household consumption grew by just 0.1% in the quarter and is tracking weak growth levels not seen in nearly a decade.
The household savings ratio also ticked up 0.2 per cent to 3.2 per cent, suggesting that households have been reluctant to run down savings to fund consumption.
The lack of demand meant inflation was also a no-show, with a key measure of domestic prices flat in the quarter.
The improved annual growth figure was assisted by the negative September quarter data from past year dropping out, and it takes Australia close to what would be considered average levels of economic expansion.
Corporate sentiment is high, buoyed by strengthening global growth and robust exports, contributing to a jump in private investment over the quarter.
Household consumption expenditure increased only 0.1 per cent in the September quarter, making it the lowest quarterly rate of growth since the 2008.
"This print will come as a major disappointment for the RBA", Westpac's chief economist, Bill Evans, said.
Growth for the year sprang ahead to 2.8 percent, from 1.9 percent, in part because a rare contraction suffered in the third quarter of last year dropped out of the calculation.