The Australian economy is expected to have grown strongly in the September quarter of 2011 as the booming mining sector fuels a solid rise in business investment.
The Australian Bureau of Statistics (ABS) national accounts, due on Wednesday, are expected to show that gross domestic product (GDP) grew by 1.0 per cent, according to an AAP survey of 16 economists.
The median market forecast for annual GDP expansion is 2.1 per cent for the year to September.
Economic growth dropped in the March quarter following a string of natural disasters, but bounced back in the June quarter, to rise by 1.2 per cent.
Mining is again expected to be the primary driver of economic growth, offsetting a weak housing market and the lacklustre performance of retail traders.
Figures released by the ABS on November 30 showed that capital expenditure in the private sector grew by 12.3 per cent in the September quarter, with miners accounting for most of the growth.
"If you take out business investment, it would all be looking pretty soft," NAB senior economist Spiros Papadopoulos said.
"We've got negative contributions from public demand and a negative contribution from stocks and net export. It's really business investment growth that gets us over the line."
However, some economists fear an expected drop in government spending and net exports and weakness in the housing and retail sectors could slow the rate of growth.
"There are swing factors that will determine whether growth is stronger or weaker than we think and we think risks are on the downside there," Macquarie Group senior economist Brian Redican said.
He said Europe's worsening debt crisis would have little bearing on figures for the September quarter.
"This data won't show the recent escalation of the European problem," he said.
"Activity in the third quarter was really determined by how consumers were feeling around the middle of the year," he said.
ICAP senior economist Adam Carr said he expected GDP growth to continue into the next year, provided European leaders can find a solution to the continent's financial woes.
"The medium term view is on track, we've got strong business investment and consumption, although more modest, is still quite solid."
"If we can avoid a credit-crunch type event then things should be alright," he said.
"(But) if we can't, things are going to be fairly atrocious," Mr Carr said.
