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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