Economy grows better than expected in March quarter

The Gross Domestic Product (GDP) growth of 2.3% trounced economists' predictions of 1.6% growth for the three months ended March 31.

It followed a rise of 0.7% in the December quarter. The big jump in the March quarter boosted the annual growth rate to 3.6% from 3.4% in calendar 2003.

Economists polled by Reuters had expected a rise of 3.5%.

The March quarter rise makes it a virtual certainty the Reserve Bank will lift interest rates twice more in the current tightening round.

The statistics, which were expressed in 1995/96 prices, showed growth in the imports sector outpaced that in the exports sector in the March quarter.

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