Macroeconomic Performance of Australia and USA: An Analysis of Key Indicators (1990-2016)

Trimester 1, 2018: BUS700
Economics
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Executive Summary
This report relates to the research with regards to the impact of various macroeconomic
factors on the economy if Australia. For the purpose of research the data collected will relate
to the period from 1990 to 2016. The macroeconomic factors discussed in this report include
GDP growth rate of Australia, real exchange rates, unemployment rate, net exports, cash
rates,, inflation rate, etc. the relationships between various macroeconomic factors his
discussed along with the comparison of the Australian macroeconomic factors with the US
economic factors. From the discussion of the impact of these factors on the economy, the
prediction of the overall outlook of the economy of the country is also included.
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Contents
Executive Summary...............................................................................................................................2
Evaluation of Macroeconomic performance of Australia and USA........................................................3
Macroeconomic indicators and data.................................................................................................3
Relationship between economic factors...........................................................................................5
GDP growth rate and inflation rate................................................................................................5
GDP growth rate and unemployment rate....................................................................................5
Relationship between net exports and real exchange rates of US and Australia...............................7
Net exports....................................................................................................................................7
Real Exchange rates.......................................................................................................................8
Relationship between Australia’s cash rates and Federal Reserve Fund rates..................................9
Prediction of macroeconomic outlook of Australia.........................................................................10
Conclusion and recommendations......................................................................................................11
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Evaluation of Macroeconomic performance of Australia and USA
Macroeconomic indicators and data
Real GDP growth rate – This is the rate of growth of the Gross Domestic Product in the
form of its variation from one year to another. Gross Domestic product is defined as the
market value of the goods and services produced in a country in a period. The GDP growth
rates of the country from the period 1970 to 2017 are as follows:
In the month of December 2017, the economy rose by 0.4 5 as compared to market rate of
0.6% whereas in the previous quarter the increase was 0.7%. In the month of September
2016, there was a decline due to non-dwelling construction and net trade sector. The reason
for growth is the increase in consumption expenditure.
Interest rates – The interest rate is the rate at which the cash is provided by the financial
institution or lender to the borrower in the form of consideration for cash payment.
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