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# Company profits rise 1.8 per cent, but mining did all the work
- URL: https://www.promptthemarket.com/company-profits-rise-but-weaker-gdp-print-looms/
- Published: 2026-09-02T00:00:00.000Z
- Updated: 2026-09-07T13:55:30.000Z
- Description: Mining profits rebounded 6.8 per cent and everyone else went backwards. Inventory prices added $3.7 billion to the headline. The GDP print has since landed at 0.4 per cent.
- Author: Editor News
- Tags: Finance, #bushletter, #noindex

![Elias Thorne](https://res.cloudinary.com/dz77sb7j1/image/upload/v1774262579/bushletter/authors/elias-thorne.png)

By **Elias Thorne** · 2026-09-01

TLDR

Company profits rose 1.8 per cent in the June quarter, but mining did all of the lifting: non-mining profits fell 1.1 per cent, and inventory prices added $3.7 billion to the total. Inventories themselves fell 0.2 per cent, which Westpac expects to shave 0.1 points off GDP. The ABS has since reported June-quarter growth of 0.4 per cent, above the 0.3 per cent consensus.

KEY TAKEAWAYS

01Gross operating profits rose 1.8 per cent in the June quarter 2026, per ABS catalogue 5676.0.

02Wages and salaries grew 1.4 per cent over the same period, a second positive signal from the ABS release.

03Inventories fell 0.2 per cent in seasonally adjusted chain volume terms, shifting their GDP contribution to a 0.1 ppt drag.

04Westpac now forecasts June-quarter GDP at 0.3 per cent quarter-on-quarter and 1.8 per cent year-on-year.

05The RBA's August 2026 Statement on Monetary Policy had pencilled in 1.9 per cent through-the-year growth to June 2026.

*Update, 2 September: the ABS reported this morning that GDP grew 0.4 per cent in the June quarter, above the 0.3 per cent most forecasters expected.[\[5\]](https://www.abc.net.au/news/gdp-june-quarter-2026/107106354?ref=bushletter.com) The analysis below was published before the release.*

## The headline number and the one underneath it

Company gross operating profits rose 1.8 per cent in the June quarter, the ABS reported on Monday.[\[1\]](https://www.abs.gov.au/statistics/economy/business-indicators/business-indicators-australia/jun-2026?ref=bushletter.com) Wages and salaries grew 1.4 per cent over the same period.[\[1\]](https://www.abs.gov.au/statistics/economy/business-indicators/business-indicators-australia/jun-2026?ref=bushletter.com) On their own, both read as good news for Wednesday's national accounts.

The figure underneath is weaker. Mining profits rebounded 6.8 per cent after a 9.4 per cent fall in the March quarter, according to Westpac's reading of the release.[\[4\]](https://www.westpaciq.com.au/economics/2026/08/australian-business-indicators-survey-Q2-2026?ref=bushletter.com) Outside mining, profits fell 1.1 per cent.[\[4\]](https://www.westpaciq.com.au/economics/2026/08/australian-business-indicators-survey-Q2-2026?ref=bushletter.com) Take out the miners and Australian business went backwards.

Inventory prices flattered the total as well. The survey counts changes in the value of stock as profit, and that adjustment added $3.7 billion in the June quarter, up from $2.4 billion in March.[\[4\]](https://www.westpaciq.com.au/economics/2026/08/australian-business-indicators-survey-Q2-2026?ref=bushletter.com) Westpac calculates that once it is stripped out, the comparable national accounts measure is closer to 1.4 per cent than 1.8.[\[4\]](https://www.westpaciq.com.au/economics/2026/08/australian-business-indicators-survey-Q2-2026?ref=bushletter.com)

## What the inventory rundown does to Wednesday

Inventories fell 0.2 per cent in the quarter in volume terms.[\[1\]](https://www.abs.gov.au/statistics/economy/business-indicators/business-indicators-australia/jun-2026?ref=bushletter.com) When businesses run down stock, the national accounts count it as a subtraction from GDP. A build-up would add to it.

Westpac senior economist Pat Bustamante said the result had changed his team's arithmetic. Inventories were now expected to take 0.1 percentage points off June-quarter growth, rather than contributing nothing.[\[2\]](https://www.westpaciq.com.au/economics/2026/09/australia-gdp-partials-Q2-2026/?ref=bushletter.com) He said the Business Indicators release had supplied the last inputs needed before the national accounts.[\[4\]](https://www.westpaciq.com.au/economics/2026/08/australian-business-indicators-survey-Q2-2026?ref=bushletter.com)

## Where the forecasts sit

Westpac's September update puts June-quarter GDP growth at 0.3 per cent, and 1.8 per cent over the year.[\[2\]](https://www.westpaciq.com.au/economics/2026/09/australia-gdp-partials-Q2-2026/?ref=bushletter.com) That annual figure is a tenth of a point below the Reserve Bank's own projection. The RBA's August Statement on Monetary Policy forecast 1.9 per cent growth through the year to June.[\[3\]](https://www.rba.gov.au/publications/smp/2026/aug/outlook.html?ref=bushletter.com)

A tenth of a point is not a crisis on its own. The RBA's outlook, though, already rests on services inflation staying high. Soft activity data leaves the board less room to hold rates without appearing to lean into weakness. Wednesday's print, measured against Westpac's 0.3 per cent, decides how much room is left.[\[2\]](https://www.westpaciq.com.au/economics/2026/09/australia-gdp-partials-Q2-2026/?ref=bushletter.com)

SOURCES & CITATIONS

1. [Business Indicators, Australia (ABS catalogue 5676.0), June 2026](https://www.abs.gov.au/statistics/economy/business-indicators/business-indicators-australia/jun-2026?ref=bushletter.com)
2. [Q2 GDP Partials & Forecast Update, Westpac IQ, September 2026](https://www.westpaciq.com.au/economics/2026/09/australia-gdp-partials-Q2-2026/?ref=bushletter.com)
3. [Statement on Monetary Policy, August 2026, RBA](https://www.rba.gov.au/publications/smp/2026/aug/outlook.html?ref=bushletter.com)
4. [Australian Business Indicators Survey Q2 2026, Westpac IQ](https://www.westpaciq.com.au/economics/2026/08/australian-business-indicators-survey-Q2-2026?ref=bushletter.com)
5. [Australia's economy grows faster than expected in June quarter, ABC News](https://www.abc.net.au/news/gdp-june-quarter-2026/107106354?ref=bushletter.com)

FREQUENTLY ASKED QUESTIONS

What did ABS Business Indicators show for the June quarter 2026?

ABS catalogue 5676.0, released 31 August 2026, recorded a 1.8 per cent rise in company gross operating profits and a 1.4 per cent rise in wages and salaries for the June quarter. Inventories fell 0.2 per cent in seasonally adjusted chain volume terms over the same period.

Why do falling inventories subtract from GDP?

In the national accounts framework, GDP includes changes in the stock of goods businesses hold. When businesses run down their inventories rather than building them up, the change in stocks makes a negative contribution to the overall growth figure.

What is Westpac forecasting for June-quarter GDP?

Westpac Senior Economist Pat Bustamante, in the bank's September 2026 Q2 GDP Partials and Forecast Update, forecasts growth of 0.3 per cent quarter-on-quarter and 1.8 per cent year-on-year for the June quarter 2026.

How does that compare with the RBA's forecast?

The RBA's August 2026 Statement on Monetary Policy projected through-the-year GDP growth to June 2026 at 1.9 per cent. Westpac's 1.8 per cent year-on-year call sits 0.1 percentage points below that projection.

![Elias Thorne](https://res.cloudinary.com/dz77sb7j1/image/upload/v1774262579/bushletter/authors/elias-thorne.png)

[Elias Thorne](https://bushletter.com/author/elias-thorne/?ref=bushletter.com)

Elias Thorne writes about interest rates, the bond market and the Reserve Bank. He is interested in what monetary policy actually does to household budgets, and in the long stretches of economic history that tend to repeat.