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Oliver's Insights - The Australian economy and profits - seven reasons to be upbeat
2/03/2017

The Australian economy and profits - seven reasons to be upbeat

Shane Oliver, Head of Investment Strategy and Chief Economist at AMP Capital AA---AMP-Capital-Image.png
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The attached note looks at the outlook for the Australian economy and profits and implications for the Australian share market.

The key points are as follows:
  • A rebound in the economy in the December quarter confirms that Australia is continuing to grow and avoid recession. 

  • There are seven reasons to be upbeat about the Australian outlook: thanks to a more flexible economy Australia is on track to take out the Netherlands for the longest period without a recession; south east Australia is continuing to perform well; the great mining investment unwind is near the bottom; the surge in resource export volumes has more to go; national income is rising again; public investment is strong; and there are signs of life in non-mining investment. 

  • Economic growth is on track to return to near 3% this year and profit growth has returned to positive after two financial years of declines. 

  • Stronger economic growth and profits are good for Australian assets.


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