Australia’s GDP Grows 0.2% QoQ in Q1 2025, Missing Expectations

Australia’s Q1 GDP Growth Slows to 0.2% as Economic Momentum Cools

Australia’s Economic Growth Disappoints in Early 2025

The Australian Bureau of Statistics (ABS) reported that Gross Domestic Product (GDP) rose by just 0.2% quarter-over-quarter (QoQ) in Q1 2025, a significant slowdown from the 0.6% growth seen in Q4 2024. The figure also came in below the market forecast of 0.4%, raising concerns over softening domestic activity.

Annual Growth Flatlines at 1.3%, Missing Estimates

On an annualized, seasonally adjusted basis, GDP increased by 1.3%, unchanged from the previous quarter but below the 1.5% consensus estimate. The data suggests that Australia’s economic momentum remains fragile, weighed down by tighter financial conditions and subdued consumer spending.

📌 More insights: What Drives Australia's GDP Growth?

Weak GDP Print May Influence RBA Policy Outlook

The weaker-than-expected growth could influence the Reserve Bank of Australia's (RBA) upcoming monetary policy decisions, as policymakers weigh inflation control against the risk of stalling economic activity.

Read next: How RBA Responds to Economic Slowdowns

Market Impact – AUD Edges Lower

Following the GDP release, the Australian Dollar (AUD) showed mild weakness as traders priced in the possibility of a more dovish stance from the RBA. Sluggish growth data may reinforce the case for keeping interest rates steady or even cutting in late 2025.

Suggested Internal Links:

• AUD/USD Reacts to Economic Data
• Australia Economic Calendar & Forecast
• Explainer: What GDP Growth Means for Currency Markets