The ingrained perception that the Federal Coalition are superior economic managers has taken another blow as the economy shows its worst results since 2000, when, incidentally, they were also in power.
The economy has been hit particularly hard by weak construction and consumer reluctance to spend. Without strong population growth this country would already be in recession.
The RBA has been urging the government to do more of the heavy lifting but the latter is so ideologically fixated on its projected surplus, it has de-prioritised all stimulatory spending measures such as increasing the Newstart payment. It has also only committed to 30 per cent of its infrastructure spending over the forward estimates. Interest rates are expected to be cut to record lows of less than 1 per cent before the end of the year.
Unemployment clings stubbornly to 5.2 per cent as the RBA specifies a figure of 4.5 per cent is needed if wage growth is to recover from years of stagnation.
Scott Morrison keeps blaming Labor even though, without a GFC, he, as Treasurer, oversaw a doubling of our nations debt and deficit.
The only silver lining is that house prices are starting to move upwards again in the bigger cities. This is small comfort though for aspiring first home buyers who, thanks to negative gearing, still compete against multi-property investors.