AIRLINK 81.10 Increased By ▲ 2.55 (3.25%)
BOP 4.82 Increased By ▲ 0.05 (1.05%)
CNERGY 4.09 Decreased By ▼ -0.07 (-1.68%)
DFML 37.98 Decreased By ▼ -1.31 (-3.33%)
DGKC 93.00 Decreased By ▼ -2.65 (-2.77%)
FCCL 23.84 Decreased By ▼ -0.32 (-1.32%)
FFBL 32.00 Decreased By ▼ -0.77 (-2.35%)
FFL 9.24 Decreased By ▼ -0.13 (-1.39%)
GGL 10.06 Decreased By ▼ -0.09 (-0.89%)
HASCOL 6.65 Increased By ▲ 0.11 (1.68%)
HBL 113.00 Increased By ▲ 3.50 (3.2%)
HUBC 145.70 Increased By ▲ 0.69 (0.48%)
HUMNL 10.54 Decreased By ▼ -0.19 (-1.77%)
KEL 4.62 Decreased By ▼ -0.11 (-2.33%)
KOSM 4.12 Decreased By ▼ -0.14 (-3.29%)
MLCF 38.25 Decreased By ▼ -1.15 (-2.92%)
OGDC 131.70 Increased By ▲ 2.45 (1.9%)
PAEL 24.89 Decreased By ▼ -0.98 (-3.79%)
PIBTL 6.25 Decreased By ▼ -0.09 (-1.42%)
PPL 120.00 Decreased By ▼ -2.70 (-2.2%)
PRL 23.90 Decreased By ▼ -0.45 (-1.85%)
PTC 12.10 Decreased By ▼ -0.89 (-6.85%)
SEARL 59.95 Decreased By ▼ -1.23 (-2.01%)
SNGP 65.50 Increased By ▲ 0.30 (0.46%)
SSGC 10.15 Increased By ▲ 0.26 (2.63%)
TELE 7.85 Decreased By ▼ -0.01 (-0.13%)
TPLP 9.87 Increased By ▲ 0.02 (0.2%)
TRG 64.45 Decreased By ▼ -0.05 (-0.08%)
UNITY 26.90 Decreased By ▼ -0.09 (-0.33%)
WTL 1.33 Increased By ▲ 0.01 (0.76%)
BR100 8,052 Increased By 75.9 (0.95%)
BR30 25,581 Decreased By -21.4 (-0.08%)
KSE100 76,707 Increased By 498.6 (0.65%)
KSE30 24,698 Increased By 260.2 (1.06%)

Australia's economy outpaced all forecasts to grow at the fastest pace in almost two years last quarter, a hopeful sign the worst of the global commodity rout may be over for the resource-rich nation. Wednesday's upbeat report sent the local dollar leaping half a US cent as investors reined back expectations of further cuts in interest rates, while providing a political boost to the coalition government of Malcolm Turnbull.
Turnbull faces a national election later this year and an improving economic background could argue for him to go a few months early, perhaps in July.
Gross domestic product (GDP) grew 0.6 percent in the fourth quarter, from the previous quarter when it rose an upwardly revised 1.1 percent.
That propelled growth for the year to 3 percent, well above the 2.5 percent that had been expected by both analysts and the Reserve Bank of Australia (RBA).
"Given Australia is going through the biggest mining pullback in our lifetimes, this is a pretty good outcome," said David de Garis, a senior economist at National Australia Bank.
"Our baseline is that the RBA is done cutting rates, and these numbers only support that view."
The central bank has held rates steady since May last year and just this week skipped a chance to ease, saying it saw "reasonable prospects" for growth.
Investors are still wagering it will have to ease eventually given the headwinds facing the global economy, but likely not as quickly. Interbank futures now imply a 45 percent chance of a cut by May, compared to 60 percent before the data.
The RBA would prefer that any further stimulus come through a lower Australian dollar, but is being thwarted by the drastic easing of central banks elsewhere.
The Bank of Japan only recently joined the club of negative interest rates and the European Central Bank is widely expected to cut further below zero next week.
The slowdown in China also remains a major uncertainty since the Asian giant takes almost a third of Australia's exports.

Copyright Reuters, 2016

Comments

Comments are closed.