/www.bloomberg.com/
By Victoria Batchelor
Sydney, Dec. 2 (Bloomberg) -- Australia's economic growth rate probably accelerated in the third quarter, driven by rising consumer spending, housing construction and business investment.
Gross domestic product probably rose 0.9 percent in the three months ended Sept. 30, according to the median forecast in a Bloomberg News survey of 22 economists. The economy expanded 0.6 percent in the second quarter.
The strength of the economy, which probably expanded 3.4 percent in the quarter from a year earlier, will convince the central bank not to follow the U.S. Federal Reserve's lead and cut interest rates, economists say.
``This will provide further evidence that Australia continues to avoid the brunt of the global downturn and post solid growth rates by international standards,'' said Tony Pearson, head of market economics at National Australia Bank Ltd.
``Given the weak global environment, it's little surprise to see growth again being domestically based.''
The Australian Bureau of Statistics releases its growth report at 11.30 a.m., Sydney time, on Wednesday, just hours after the Reserve Bank of Australia publishes its monthly decision on interest rates.
The central bank board will keep the benchmark interest rate unchanged at 4.75 percent, according to 22 of 23 economists surveyed by Bloomberg News. The bank raised the overnight cash target rate in two quarter percentage point increases in May and June before leaving rates unchanged since.
``Looking beyond the third quarter, the drought and weak international outlook remain the key risks to Australia's economy,'' Pearson said.
Consumer Spending
Rising consumer spending and a residential construction boom helped Australia weather slowing global growth that cut demand for exports, which make up one-fifth of the economy.
As well, an El Nino-induced drought across more than one-third of Australia has slashed grain and cotton crops, cut wool and milk production and caused cattle prices to tumble.
The deterioration in the trade balance, or net exports, subtracted 0.3 percentage points from third-quarter gross domestic product, according to government figures released last week.
Underpinning economic growth, retail sales excluding inflation rose a more-than-expected 0.7 percent in the third quarter. Business investment gained 2.3 percent in the quarter.
Residential building work completed in the quarter rose 4.3 percent from the previous three months and non-residential construction surged 11.4 percent.
Borrowing costs at a three-decade low until May and a A$10,000 government handout to first-home builders until July helped fuel construction and consumer spending on furnishings.
The GDP forecasts are preliminary because analysts may adjust them after today's reports on businesses inventories and company profits in the third quarter.