Annual growth was at 2.1%, above expectations for 1.8%, slowing from a 2.4% gain in Q1.
Household consumption, which used to be the engine of growth, remained subdued with just a 0.1% gain and added 0.1 percentage points to growth due to spending on essential goods and services.
Consumers continued to tighten their belts as the savings ratio dropped further to 3.2%, the lowest level since 2008, suggesting the rate hikes are working to slow demand.
The Reserve Bank of Australia left interest rates unchanged for a third straight month on Tuesday as inflation cooled and growth slowed. Consumer inflation slowed to a lower-than-forecast 4.9% in July and away from last year’s peak of 8.4%.
