2017.11.2002:32:00UTC+00IMF Says Conditions In Place For Pickup In Australia's Growth

Conditions are in place for a pick-up in Australia's economic growth to above-trend rates, the International Monetary Fund said.

Concluding the Article IV mission, IMF staff said, "The pickup in growth is likely to be modest." Meanwhile, inflation and wages will be slow to rise.

Household consumption is expected to be held back by low real wage growth, given labor market slack and structural change in some sectors. Economic slack is forecast to decline gradually.

According to IMF, upward pressure on prices and wages should emerge once the economy has been at full employment, including lower underemployment, for some time.

The lender assessed that continued macroeconomic policy support will remain essential as inflation was close to the mid-point of the target range not yet secured.

Further, the agency said near-term risks to growth have become more balanced, but large external shocks, including their interaction with the domestic housing market, are an important downside risk.