The impact of severe weather conditions on Australia’s economic growth, which has decreased to 0.2%, is a pressing concern.

The Australian economy experienced a disappointing start to 2025, with growth of just 0.2% in the first three months compared to 0.6% in the previous quarter. Despite this, annual growth remained steady at 1.3% according to figures from the Australian Bureau of Statistics. ABS’s head of national accounts, Katherine Keenan, described the data as “soft.” Keenan also noted that public spending recorded the largest detraction from growth since the September quarter of 2017. Extreme weather events and their impact on mining, tourism, and shipping contributed to the slowdown. Graphs highlighting the economic slowdown in early 2025 were also presented. GDP per capita fell by 0.2% in the three months to March, following a 0.1% rise in the December quarter. Despite the marked slowdown, Treasurer Jim Chalmers acknowledged that “any growth is a decent outcome” amidst global uncertainty. Chalmers also emphasized that the Australian economy remains one of the strongest in the world, driven by the private sector. The impact of Cyclone Alfred and flooding in south-east Queensland was significant, with Treasury estimating that natural disasters in the first half of 2025 would cost the economy $2.2 billion. Additionally, Donald Trump’s trade tariffs have added uncertainty to the global economy, influencing the Reserve Bank’s decision to cut interest rates. More details on the situation are forthcoming.

Source: https://www.theguardian.com/business/2025/jun/04/extreme-weather-weighs-on-australian-economy-as-growth-slows