The major driver of the slowdown has been weaker private domestic demand, most prominently a sharp decline in business investment spending, with a fall off in housing construction. The fall in investment is best seen as the same understandable precautionary behaviour by Australian businesses as displayed by their counterparts around the world.
A decline in business investment spending of about 8 to 10 per cent in the December quarter seems to have been a pretty standard result around the world. Macroeconomic policies have not been able to prevent an economic downturn. They rarely can, especially in the face of a global recession of this magnitude.