SYDNEY: Australia's mining-powered economy grew 1.0 percent during the September quarter in a result hailed by the government on Wednesday as "exceptional" given the ongoing global turmoil.
The Australian Bureau of Statistics said mining and construction underpinned the robust performance, which represented on-year growth of 2.5 percent and followed upwardly revised growth of 1.4 percent for the three months to June.
Economists had expected gross domestic product to rise 0.8-1.0 percent quarter on quarter and 1.9-2.1 percent from a year earlier.
Treasurer Wayne Swan said the data was "an exceptional result at a time of heightened global instability, turmoil in Europe and slowing global growth".
The Australian dollar jumped to 102.72 US cents after the announcement, from 102.43 US cents before.
But analysts warned of growing disparities in the economy and an underlying weakness being masked by the mining boom and recovery from summer floods and cyclones.
Resources-rich Western Australia state saw seasonally-adjusted demand grow 8.4 percent in the quarter and 16.4 percent in the year while coal and gas-mining Queensland was similarly strong.
Most other regions were flat or went backwards, clear evidence of what CommSec economist Craig James called the "two-speed or three-speed economy".
"Areas like construction, particularly the engineering variety, are doing very well together with mining," said James.
"But then you've got some of the more domestically-focused areas of the economy and the services sectors which are relatively soft."
Construction contributed 0.4 percentage points and mining 0.3 points to GDP growth, which was slightly offset by growing imports and running down of inventories.
Swan said growth was underpinned by a 12.7 percent "surge" in business investment in the quarter and above-trend household consumption despite the hit to confidence from debt woes in Europe and the United States.
A jump in car sales as Japan's auto sector recovered from March's earthquake and tsunami accounted for a large part of the consumer spending.
New engineering construction leapt 31.0 percent in the quarter to be more than 50 percent higher year-on-year -- its strongest annual growth in about 30 years.
"While much of the increase was in the resources sector there was also a healthy increase in manufacturing investment," Swan added.
"These figures are a resounding vote of confidence in our economy at a time when many advanced economies are struggling to grow at all, and face increasingly fragile economic positions with very high unemployment."
Canberra last month slashed its growth forecast for 2011/12 from 4.0 percent to 3.25 percent, and flagged the same again for 2012/13 -- a downward revision from the 3.75 percent expected in May.
HSBC's Paul Bloxham said growth was expected to rally further, with northern Australia's flood and cyclone-hit coal mines yet to fully recover and reconstruction from the wild weather not yet at full pace.
But aside from mining and recovery-related spending, Bloxham said the economy was "tracking at a bit below trend," and global prospects were gloomy.
"We expect that the mining investment boom will continue to support solid growth, but the concern is that offshore risks have grown substantially," he said.
Swan conceded there was an "uneven pattern of growth" but said the economy was "better placed than virtually any other advanced economy to deal with ongoing global instability and the unfolding crisis in Europe."
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