Current State of Australian Economy: Analysis and Issues

Runnning head: ECONOMICS
Economics
Name of the Student
Name of the University
Course ID

ECONOMICS1
Table of Contents
Abstract............................................................................................................................................2
Introduction......................................................................................................................................4
Current State of Australian economy..............................................................................................4
Economic growth.........................................................................................................................4
Unemployment rate.....................................................................................................................6
Inflation........................................................................................................................................7
Trade............................................................................................................................................8
Major issues that Australia is currently facing..............................................................................10
Conclusion.....................................................................................................................................11
References......................................................................................................................................12

ECONOMICS2
Abstract
The report is prepared to analyze current state of Australian economy in comparison to trend
performance of the economy in comparison to past five years. Analysis of economic
performance is based on evaluation of some crucial economic indicators. In this connection, the
first important indicator is that related to aggregate output of the nation. The comprehensive
measure used for estimating aggregate output a nation is known as Gross Domestic Product. It is
a measure that computes monetary value of produced goods and services. Growth in GDP
measured by percentage change in GDP from one year to next be used a measure of economic
growth of nation. In order to evaluate current state of economic growth, growth rate of GDP in
the respective years are take into consideration. Evaluation of labor market performance depends
on the trend in unemployment rate of the nation. Movement of price level is to be understood in
terms of recorded trend in the inflation rate of the economy. It is a measure of rate of change in
the consumer price index. Measures related to international trade include current account
balance, term of trade, net foreign debt and value of Australian dollar. The current economic
performance of the nation as recorded in 2019 was compared with the recorded performance
since 2015. Apart from discussing current economic performance the report also investigates
issues faced by Australian economy in current years.
Statistics recorded by Australian Bureau of Statistics shows that Australian economy
grew only at a rate of 0.5 percent at the end of second quarter of 2019. Most part of the economic
growth was accounted by steady performance of external sector. Trade balance of Australia has
improved significantly. Along with this there is a considerable increase in government spending
making positive contribution to GDP growth. Economic growth in recent year is relatively lower
than that the recorded growth in the previous year. Unemployment rate in the economy has

ECONOMICS3
decreased in 2019 when compared to the rate of unemployment since 2015. Rate of
unemployment in August 2019 however is slightly higher than the recorded unemployment rate
in the previous month. Part time employment has increases while that of full time employment
has decreased. There is however an overall increase in employment mainly due to the increase in
part time employment. Price level as measured by the inflation rate of the economy remained
almost stable and within the targeted range. In case of trade, despite improvement in current
account balance, the economy is still suffering from a current account deficit. There is an
overtime increase in net foreign liabilities. Terms of trade remains almost favorable while value
of Australian dollar depreciated against US dollar in recent times.
The below average growth rate of Australia has become one of the major concern for the
economy. Australia has now recorded the weakest ever growth rate. Along with slow rate of
economic growth, two other issues adding to economic tensions are persistently low growth of
wages and crisis in the housing market.