Australia's economy slows as India posts 7.7% growth, underscoring divergent Asia‑Pacific trends

Australia's economy grew by only 0.3 % in the first quarter of 2026, down from 0.9 % at the end of 2025, while GDP per person fell 0.1 %. The slowdown reflects weaker household discretionary spending, higher fuel and fertilizer prices linked to the Middle‑East war, and a sharp decline in mining output after Cyclone Koji. Private investment rose sharply, driven by data‑centre and AI‑related spending, but net trade dragged growth as coal and iron‑ore exports fell.

India closed its fiscal year 2025‑26 with real GDP expanding 7.7 %, with the final quarter at 7.8 %. Growth was broad‑based, led by services (up 12.5 %) and supported by strong private consumption and a rise in gross fixed capital formation. Manufacturing and construction also posted solid gains. Economists note external risks – higher global energy prices, geopolitical tensions and climate‑related disruptions – could temper growth in the next fiscal year, but the data reinforce the government’s narrative of a resilient economy.