Australia: Economic growth to sustain at a steady rate - NAB
Analysts at NAB explain that they are quietly confident that improving prospects for infrastructure construction and non-mining business investment will help sustain Australia’s economic growth at a steady (but moderate) rate, despite some obstacles ahead.
“Real GDP growth is forecast to strengthen in coming quarters to 3.2% y/y by Mar-18, ease to 2.4% by Dec-18 before picking up slightly to 2.6% by end-19. Our inflation forecasts have been revised down slightly to reflect new weights from the ABS, with core inflation expected to hit the bottom of the RBA target band by end-18. The RBA remains comfortably on hold, with few hints of a move in either direction. We still expect two 25bp hikes in H2 2018, subject to more progress being made on reducing unemployment and/or underemployment, and wages growth showing some (at least tentative) signs of picking up.”