Australia's economy slowed more than expected last quarter as consumers reacted to tepid wage growth by shutting their wallets, a disappointing outcome that sent the local dollar sliding as investors pushed out the chance of any rate hike.
The news came as fears of a possible slowdown in the U.S. economy and the Sino-U.S. tariff slugged world shares and threatened future business investment.
The gloomy report provides another blow to Australia's center-right government, which is already lagging in polls ahead of a likely election in May.
Wednesday's report on gross domestic product (GDP) showed the economy expanded 0.3 percent in the third quarter, half of what economists had expected.
Second-quarter growth was unrevised at 0.9 percent.
Annual GDP rose by a still-respectable 2.8 percent to A$1.8 trillion ($1.32 trillion), but confounded expectations in a Reuters poll for a 3.3 percent increase.
The figures also imply growth in the year to June was 3 percent, rather than the originally report 3.4 percent.
The data will not be welcomed by the Reserve Bank of Australia (RBA), which predicts growth of around 3-1/2 percent this year and next.
"The RBA forecasts are now looking pretty optimistic," said Tom Kennedy, senior economist at JPMorgan.
"You are seeing consumer spending pull back a little bit... There's not that much cash out there for consumers to spend to their discretion," he added.
"Wage growth is low and the household savings rate is also pretty low. You overlay that with the fact that housing is slowing means the wealth effect... is no longer supporting consumption."
The disappointing set of numbers sent the Australian dollar on a dive to $0.7295 from a high of $0.7355 touched earlier in the day. It was last own 0.4 percent at $0.7310.