Growth driven by household expenditure
The Australian economy grew by 0.9% in the June quarter 2018, according to the ABS.
However, GDP growth per capita was only up by 0.5% over the quarter. GDP growth per capita is important because it is what drives increases to living standards.
RBA warns of household debt risks
High levels of risk exist across both bank and household balance sheets, as Australia has some of the highest levels of debt-to-income internationally, RBA assistant governor, financial system, Michele Bullock warned. Australia’s median debt-to-income ratio increased from 70% in the 1990s to around 190% today.