The Australian economy contracted in the third quarter of this year, raising the spectre of a possible recession Down Under. But this morning saw good news.

The last time Australia suffered a recession was the early 1990s – that’s assuming you define recession as two successive quarters of contraction. The economy Down Under did suffer contraction after the crisis of 2008, but only for a quarter.

But in Q3 of this year, Australian GDP contracted by 0.5 per cent. Just as worrying, last week saw data revealing a nasty jump in the country’s trade deficit, so that didn’t auger well.

On the other hand, the central bank seems about as worried as a marsupial lounging about the Outback.

But now we have some good news. The latest index tracking Australian consumer confidence jumped nicely in November, almost reversing October’s fall.

Okay, the measure of current conditions fell to a 19-month low – so that was not so good, but then again, this is a backwards looking indicator and more a sign of how things slowed recently rather than a sign of trouble right now.

Then again, other data suggested that the Australian housing market, also known as the Australian bubble – is slowing. Recent data pointed to a 23% fall in housing sales.

Besides recent tightening of monetary policy has not yet had an impact.

Paul Dales, chief Australia & NZ economist at Capital Economics said: "Overall, while the economy will probably avoid a recession in the fourth quarter, it’s not going to get much of a helping hand from the housing market next year.”