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The Australian economy expanded 0.4 per cent in the final quarter of 2022/23, driven by capital investment and exports of services.

The pace of quarterly growth was steady from March after the earlier result was revised up to 0.4 per cent by the Australian Bureau of Statistics.

On an annual basis, the bureau recorded a 2.1 per cent increase in gross domestic product for the 2022/23 financial year.

This is based on a measure comparing the economy between the June quarter of 2022 and the June quarter of 2023 and excluding part of the recovery from the lockdowns.

ABS head of national accounts Katherine Keenan said capital investment and exports of services were the main drivers of GDP growth in the quarter.

"This was the seventh straight rise in quarterly GDP, and annual growth remained above trend, reflecting the absence of significant COVID-19 disruptions, such as lockdowns, in 2022/23," she said.

GDP per capita, however, fell 0.3 per cent, to reflect a population growing strongly as borders reopened.

GDP is the primary way that activity in the economy is measured.

Growth numbers in the national accounts were broadly expected to be underwhelming as the economy responded to an aggressive series of interest rate hikes and elevated inflation.

The growth rate was tipped to rise by 0.3 per cent in the three months to June and by 1.8 per cent over the year.

© AAP 2023

Australia is expected to avoid a recession although the federal treasurer warns higher interest rates and dicey global conditions are slowing growth.

"Our expectation, our forecast in the budget, are that the Australian economy will continue to grow but quite slowly," Treasurer Jim Chalmers told ABC News on Wednesday.

Dr Chalmers' comments foreshadowed the Australian Bureau of Statistics' latest update on the nation's economic performance due later on Wednesday.

In the three months to March, the economy grew a modest 0.2 per cent, and 2.3 per cent on an annual basis.

The treasurer warned there was still a lot of uncertainty, both globally and domestically, that could show up in the June national accounts.

"The two things that matter most will be China and the impact of these interest rate rises which are biting on family budgets and on the economy more broadly," he said.

The Reserve Bank opted to keep interest rates on hold in September as it monitors several sources of uncertainty, including the problems facing the Chinese economy and the confusing consumer sector.

Liberal senator Simon Birmingham said the treasurer was "buttering people up" for lacklustre national accounts figures.

"The real concern is that under the Albanese Labor government the biggest economic reform they currently have on the agenda are industrial relations changes that will only further weaken our economy," he told ABC Radio.

Ahead of the June growth numbers, forecasters were feeling more upbeat following the release of some of the last remaining data points that slot into GDP.

Commonwealth Bank updated its forecast higher in the wake of strong public demand and net exports data, with the bank pencilling 0.5 per cent quarterly growth and a 1.9 per cent lift across the year.

Economist Stephen Wu said the results would mask weakness in private demand.

"Instead, the pick-up in GDP growth reflects comparative strength in the public and external sector as well as rapid population growth," he predicted.

Australian manufacturers have been under pressure from higher interest rates according to Ai Group's industry index.

The August gauge reported falling activity, employment and new orders across a range of industries although in a positive sign, revealed easing price pressures along some supply chains.

© AAP 2023

The discovery of a missing branch of the koala family tree has shed light on the evolution of the iconic marsupial.

The Lumakoala, which lived about 25 million years ago and was about the size of a domestic cat, has filled a knowledge gap in the evolution of its drop bear ancestor.

Flinders University PhD student Arthur Crichton found the ancient animal's fossilised teeth in central Australia and led the study confirming its relation to modern-day koalas.

"The new species ... probably ate mostly soft leaves but wouldn't have turned down an insect given the chance," he said.

He says the Lumakoala resembles 55 million-year-old fossils of marsupials Thylacotinga and Chulpasia, which suggests the older animals were also related to koalas as well as fellow diprotodons possums, wombats and kangaroos.

"If our hypothesis is correct, it would extend the diprotodontian fossil record back by 30 million years," Mr Crichton said.

Co-author Associate Professor Robin Beck says the discovery raises the possibility these ancestors of modern Australian marsupials were also related to marsupials found in Antarctica and South America, where similar fossils have been uncovered.

As well as the Lumakoala, two other types of koala - Madakoala and Nimiokoala - have been reconstructed from the fossils found at the Pwerte Marnte Marnte site south of Alice Springs.

Professor Gavin Prideaux, director of the Flinders University Palaeontology Laboratory, said the additions to the fossil record meant there would have been at least seven koala species roaming Australia in the late Oligocene period (23-25 million years ago) - a "koala heyday".

© AAP 2023