Westpac Coast-to-Coast

Australia is experiencing a sluggish growth environment defined by a 'two-speed' economy. Massive, structurally-driven investment in data centers and energy is offsetting a weak household and consumer sector.

Key Takeaways

• 1.Australia's national economic growth is slowing due to a weak domestic pulse, with GDP growth expected to hit just 0.7% yr in 2026.
• 2.A 'two-speed' economic dynamic is emerging, where heavy investment in data centers is driving growth in NSW and Victoria, while consumer-led demand remains weak.
• 3.The combined state fiscal position has deteriorated with fiscal repair delayed by at least another year, largely due to housing market downturns and rising costs.

Table of Contents

• Overview
• States
• Forecasts

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