Australia Q3 inventories to drag on GDP, company profits rise

SYDNEY (Reuters) – Australian firms ran down inventories by more than expected in the third quarter in a likely drag on economic growth, while company profits rose thanks in part to government subsidies amid coronavirus lockdowns.

Figures from the Australian Bureau of Statistics out on Monday showed inventories fell 1.9% in the third quarter, when analysts had forecast a flat outcome. That may have taken around 0.6 percentage points from gross domestic product, which was already seen falling sharply due to the lockdowns.

Company gross operating profits rose 4.0% in the quarter, while the wages bill fell 0.8% due to stay-at-home orders in Sydney and Melbourne.

(Reporting by Wayne Cole; Editing by Kim Coghill)