Analysts see Australia GDP growing 2.6% in 2016
The economy is seen weathering an unwelcome rise in the local dollar and uncertainty over China this year
Sydney
AUSTRALIA'S economy is seen weathering an unwelcome rise in the local dollar and uncertainty over China this year, while the worst fallout from a mining downturn may finally be over.
The latest Reuters poll of analysts expects Australia's A$1.6 trillion (S$1.65 trillion) of gross domestic product (GDP) to expand 2.6 per cent this year, unchanged from the previous poll. Growth was forecast at a solid 2.9 per cent for 2017. That would actually be a step down from last year when the economy surprised everyone by expanding at a 3 per cent pace, well above previous forecasts of 2.3 per cent.
Gains in consumer spending, new home building and export volumes all played a part in the better outcome.
The improving mood was clear in a closely watched survey of Australian business out this week that showed firms were enjoying the best conditions in eight years.
"A jump in both business conditions and confidence provides more assurance that the Australian economy is weathering the global challenges well, and is successfully transitioning through the end of the mining boom," said Alan Oster, chief economist at National Australia Bank.
The unwinding of a once-in-a-century bonanza in mining investment has taken a chunk out of growth in recent years, while a slump in commodity prices has eaten into export earnings, company profits, wages and tax revenues. REUTERS
