South Australia is "hitting a sweet spot" of strong growth and low inflation compared to other states, according to Westpac's "Coast to Coast" quarterly report on Australia's state economies.
The update adds to a roll-call of endorsements for the direction of the South Australian economy under the Malinauskas Labor Government, with top billing on the ANZ Stateometer, BankSA's State Monitor finding consumer confidence at its highest level in four years and the Business Council of Australia ranking our state the best place to do business in the nation for three years in a row.
The Westpac report, published yesterday, enthuses that "spending is accelerating and broadening, a strong labour market is securing households, and while inflation has ticked up, localised pressures are mostly absent".
It noted that for a second year in a row, "SA came first on growth as demand advanced 5.0% over 2025 – well above trend and a stark contrast to history".
"SA usually trailed domestic demand by ½ppt, but now it leads by over 3ppt," the report noted.
It also pointed out that Adelaide's headline and core inflation is second-lowest across the capitals, behind only Melbourne, where growth has been below-trend.
The Westpac report argued this exemplified "the appeal of productivity enhancing investment as a less inflationary driver of growth".
And the report was positive about the trend continuing, noting that "with hours worked growing 6 per cent per year in 2025 and the lowest unemployment rate across the nation, labour incomes and consumer spending should continue to recover, and potentially outperform on a per capita basis".
"A strong labour market and relative lack of localised inflation pressures will support real incomes and consumption," the report states.
"Business investment is already responding positively to this. While dwelling approvals are stabilising, a healthy existing pipeline will also buoy housing construction activity herein."
As put by Tom Koutsantonis
In recent times we have become accustomed to strong endorsements from major financial institutions about the shape of the South Australian economy.
The latest quarterly Westpac "Coast to Coast" snapshot continues that trend, highlighting our record jobs growth, low unemployment, nation-leading economic growth and relatively low inflation.
The economy is in great shape, and that means we are well placed to respond to international headwinds and economic shocks.
Confidence in our economy creates investment, which will only help to keep SA accelerating on this positive trajectory under a re-elected Malinauskas Government.
