According to the Securities Times app, Australia's economy remained stagnant in the second quarter of June, with actual GDP growth of 0.2%, unchanged for three consecutive quarters, slightly below the market's expected 0.3%. High borrowing costs and persistent inflation have squeezed consumers, making government spending the main driver of economic growth.

Data released by the Australian Bureau of Statistics on Wednesday also show that domestic price pressures remain high, highlighting the reluctance of the central bank to cut interest rates in the short term, despite market expectations of a policy easing in December.

The annual growth rate fell from 1.2% in the previous quarter to 1.0%, excluding the impact of the epidemic, marking the lowest level since the economic recession of the 1990s.

This quarter, due to reduced international tourism by consumers, household spending, which accounts for half of GDP, actually decreased by 0.2%, dragging down economic growth. The saving rate remains low at 0.6%.

Sean Lang, Director of Macroeconomic Forecasting at the Australian Oxford Economics Research Institute, said, "The economy lacks a clear growth engine. Tight policy measures have successfully controlled demand, but inflationary pressures have not been fully tamed."

"Income tax cuts and consumer subsidies will help boost growth momentum in the second half of this year. However, any improvement in activity will not be significant."

The economic downturn is mainly planned by the Reserve Bank of Australia, which raised interest rates to a 12-year high of 4.35% to suppress demand and price pressures, but the potential inflation rate was still as high as 3.9% in the last quarter.

Productivity, measured by the indicator of output per hour worked, declined by 0.8% this quarter. This result may concern the Reserve Bank of Australia, as its forecast for the inflation rate to return to the target range of 2-3% by 2026 is centered on the recovery of productivity.

The country's finance minister, Jim Chalmers, described the GDP data as "soft and weak," but he stated that these data met expectations due to the government's medical support for the economy.

The economy is in urgent need of growth.

The Reserve Bank of Australia expects the economic growth rate to rebound to 1.7% in the fourth quarter and assumes that there will be two strong quarters in the second half of this year, although evidence of the expected rebound in consumer spending is lacking so far, as most of the tax cuts have been saved by households.

Retail sales remained flat in July, indicating that the large-scale tax cuts have not yet boosted spending. August credit card data from Westpac showed only a gradual recovery in retail sales, suggesting that fiscal support has little impact on demand.

The financial markets still believe that the Reserve Bank of Australia has a 90% chance of cutting rates in December, although policymakers have almost ruled out the possibility of a rate cut this year, as the underlying inflation rate was 3.9% in the last quarter, remaining high.

In fact, the price indicators in the GDP report are also high, with the domestic demand inflation rate for the whole year at 4.2%.

Due to the decline in commodity prices, trade conditions have decreased by 3%.

All of these inflations are a blessing for nominal GDP. As of June this year, nominal GDP has grown by 4.4%. However, excluding the impact of inflation, per capita GDP has decreased by 0.4% in this quarter, marking the sixth consecutive quarter of decline.

IG analyst Tony Sicamore said: "Given the current growth trajectory, as well as persistent high inflation and sluggish consumer spending, it is not entirely clear where the economic growth rebound will come from unless the Australian central bank proactively cuts interest rates."