South Australia has overtaken other states in economic performance at a time when all corners of the nation are feeling the weight of price pressures and higher interest rates.

The top mark was the first for SA in the 14-year history of CommSec’s quarterly assessment of state and territory economies, and unseated Victoria from first place.

SA took out the number one position after ranking first on four of the eight indicators, including how many new homes were under construction and how quickly the economy grew compared to normal.

The report, which judges economic performance relative to the usual state of affairs in each jurisdiction, had Victoria and NSW in equal second place.

Western Australia came in next, buoyed by the strongest population growth of any state when compared with its decade-long average.

Tasmania was fifth, the Australian Capital Territory sixth, Queensland seventh and Northern Territory in eighth place.

CommSec chief economist Craig James said higher borrowing costs and inflation were hurting state and territory economies, while a solid jobs market and strong population growth was working in the opposite direction.

“The future path will depend on the response of inflation to higher interest rates,” he explained.

Trends in jobs, consumer spending and housing would be the key to maintaining momentum in Queensland, NSW and Western Australia, with seven of the eight states conceivably in line for the top position next quarter.

“But South Australia, NSW and Victoria are most likely to challenge for top spot,” the State of the States report said.

SA Treasurer Stephen Mullighan said his state’s top-ranking performance last quarter was evidence of its investment in its economy.

“We are the lowest-taxing state on the mainland, we’ve cut stamp duty for first home buyers, and we’ve boosted investment in infrastructure,” he said on Monday.

 

Poppy Johnston
(Australian Associated Press)