According to CommSec’s latest State of the States report, Victoria has the top-performing economy of any Australian state or territory. It is the first time in the report’s nine-year history that Victoria has out-performed NSW.

The State of the States report is released quarterly, with CommSec analysing eight key indicators: economic growth; retail spending; equipment investment; unemployment; construction work done; population growth; housing finance and dwelling commencements.

“Just as the Reserve Bank uses long-term averages to determine the level of ‘normal’ interest rates; we have done the same with key economic indicators. For each state and territory, latest readings for key indicators were compared with decade averages – that is, against the ‘normal’ performance,” reads the report.

Victoria is in the top spot due to strong population growth, driving broad construction activity, particularly homes.

NSW is in the second spot on the economic performance rankings with slippage in a number of housing indicators. While Victoria has out-paced NSW, there is little to separate the two economies.

The ACT holds the third spot in the performance rankings ahead of Tasmania, which is benefitting from firmer activity in home-buying and building.

Queensland is now in the fifth spot ahead of South Australia, but there is little to separate the two economies.

Northern Territory remains in seventh position just ahead of Western Australia. There are positive trends for both economies, particularly regarding investment.