By How Much Did the Australian Economy Outperform?

Updating our earlier model of Australian GDP growth for yesterday’s data revisions yields a forecast for the March quarter of -0.5% q/q compared to an actual result of 0.4% q/q.  So growth was 0.9 percentage points stronger than a forecast based solely on US GDP growth.  This outperformance is even larger if we believe the expenditure measure of GDP (1.1% q/q), but turns into underperformance if we believe the conceptually equivalent production measure, which came in at -0.9% q/q.

Of all the country-specific factors that might account for this outperformance, discretionary fiscal policy is likely to have been the least of them.