Australia’s 2018 Federal Budget: Real GDP is forecast to grow by 2.75% in 2017-18

Australia’s Treasury published its annual Budget release on Tuesday, with the key highlights found below, courtesy Business Insider.

The 2018 federal budget uses a series of assumptions of fundamental economic indicators to do its forecasts.

Real GDP is forecast to grow by 2.75% in 2017-18.

Higher wages, inflation and better terms of trade will contribute to a rise in economic growth.

The economic outlook says momentum in the Australian economy strengthened in the second half of 2017.

However, there are key uncertainties around the strength of the pickup in non-mining business investment and the degree of spare capacity in the labour market.

The Economic outlook read: “The transition from the investment phase of the mining boom towards broader-based growth is set to be completed by the end of the forecast period. Growth is forecast to pick up to a pace sufficient to lower the unemployment rate over the next few years. The Australian economy is being supported by a positive global outlook. Global growth exceeded expectations in 2017, rising to its fastest pace in six years.

“Domestically, conditions remain favourable with consumer and business surveys at above-average levels. Solid contributions from consumption and non-mining business investment should underpin a pick-up in growth, as the drag from the unwinding of the mining investment boom recedes. Mining exports are also forecast to grow solidly.”