Aussie economy fails to rebound as strongly as hoped for in Q3

Australia's economy in the third quarter grew at the slowest annual pace since the pandemic, disappointing hopes for a rebound as government spending did all the heavy lifting and consumers remained cautious.

Markets moved to almost fully price in a rate cut next April at 96 per cent from 73 per cent before, and see a 35 basis points easing for May, from 28 bps before.

Data from the Australian Bureau of Statistics (ABS) on Dec 4 showed real gross domestic product (GDP) rose 0.3 per cent in the September quarter, missing market forecasts of 0.4 per cent.

Annual growth slowed to 0.8 per cent, from 1 per cent the previous quarter, contrary to expectations of a small pickup to 1.1 per cent. That marked the slowest pace since late 2020.