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Australian Economics

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Austrlian Economics

Seasonally adjusted, the current account deficit rose $2,267m to $7,469m. The deficit on the balance of goods and services rose $2,339m to $2,355m. The income deficit fell $85m to $5,129m.

In seasonally adjusted chain volume terms there was an increase of $2,203m in the deficit on goods and services. This could be expected to make a contribution to growth of -1.3 percentage points in the June quarter 2002 volume measure of GDP.

In original terms, the balance on current account for 2001-02 was a deficit of $22.2b, up from the deficit of $18.2b in 2000-01.

Trend exports of goods and services rose by 0.7% (up 0.4% seasonally adjusted), with exports of goods up 1.0% and exports of services down by 0.9%.

Trend imports of goods and services rose by 3.8% (up 6.0% in seasonally adjusted terms), with imports of goods up by 4.3% and imports of services up by 3.0%.

In June quarter 2002 the terms of trade index derived from trend estimates (see Explanatory Notes, paragraph 31) rose by 0.5%. The implicit price deflator for exports fell by 1.0%, while the deflator for imports fell by 1.5%.

Aside from normal quarterly revisions to recent quarters and the introduction of a new base year and new reference year (described on page 2) some other revisions have been incorporated into the June quarter estimates. These are described below.

The three independent measures of GDP using the income approach (GDP(I)), the expenditure approach (GDP(E)) and the production approach (GDP(P)) have been initially balanced for 2000-01 in both current prices and in chain volume terms, resulting in revisions for that year.

An investigation revealed that the annual volume movements for GDP(E) and GDP(P) were unbalanced in 1999-2000. Adjustments to ensure balanced movements in both measures resulted in a -0.3% revision

to the annual volume growth in GDP in 1999-2000. There have also been revisions of +0.1% to the annual volume growth rate of GDP in 1994-95 and 1996-97.

Revisions have been made to estimates of private gross fixed capital formation on other buildings and structures; exports and imports of goods and services; and construction industry gross value added, associated with revised estimates of the value of engineering construction work done in the Northern Territory. This has resulted in small revisions back to September quarter 2000.

A number of series have been seasonally re-analysed, with the most notable being the chain volume estimates of industry gross value added and current price and chain volume estimates of government final consumption expenditure on defence.

As noted in the previous release of this publication, recent examination of the historical time series identified residual seasonality in seasonally adjusted estimates of GDP and some of its components for the period prior to 1985-86. Some adjustments were made in the March quarter release and additional revisions have been made in this release to remove the residual seasonality.

In volume terms, GDP increased by 0.6% in the June quarter.

On the expenditure side the rise in GDP was driven by growth in private gross fixed capital formation (contributing 1.1 percentage points) and household final consumption expenditure (0.9 percentage points). Within private gross fixed capital formation all three major categories-dwellings, other buildings and structures, and machinery and equipment-recorded solid contributions. These positive contributions were offset by negative contributions imports of goods and services (-1.3 percentage points) and changes in private non-farm inventories (-0.3 percentage points).

On the production side the main contributors to GDP growth were the construction industry (0.3 percentage points) and health and community services (0.2 percentage points). Property and business services partially offset this growth with a negative contribution of -0.2 percentage points.

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