Australia posts weaker-than-expected economic growth

<p>Australia’s economy grew by 0.3 per cent in the third quarter of the year.</p>

Australia's economic growth for the third quarter of 2015 fell below the expectations of many analysts.

The southern hemisphere nation saw its economy grow by 0.3 per cent in Q3, compared to the same period a year ago, while there was also a 2.7 per cent year-on-year boost. Despite the slight gains, it was down from the 0.7 per cent quarterly growth and 3.1 per cent year-on-year rise predicted by economists.

One of the main reasons for Australia posting weaker than expected figures was the reduction in mining investment. Analysts explained that the drop off in funding in mining companies across the country could create a significant hurdle for the economy to navigate for the next two years. This was coupled with gross domestic product (GDP) growing below trend.

Speaking to the BBC, Michael McCarthy, an analyst at Sydney-based CMC Markets, said: "Australian GDP growth in the third quarter significantly undershot expectations, with shares and the Australian dollar weakening immediately. Recent leading indicators such as capital expenditure and building approvals have shown strength."

Earlier in the month, Australia signed a major free trade agreement with China. The deal has been decades in the making and Australian prime minister Tony Abbott explained that it will help to open up markets worth billions of dollars. The agreement will allow Australian dairy farmers, winemakers and other sectors tariff-free access to major Chinese markets in the coming years.

Mr Abbott described the deal as coming "with a substantial economy, with a major economy; and it's the most comprehensive agreement that China has concluded with anyone". The two countries have been in trade talks for the two decades and finally a resolution has been found for the pair to benefit from each other's offerings.

In 2013, the trade deal was valued at around A$150 billion (£80.6 billion) but the government believes that this latest movement in the talks will add a further A$20 billion to the overall value.

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