A leading economist and finance commentator has predicted a positive outlook for Queensland’s economy, and says interest rates will hold.
Tom Piotrowski says lower than expected inflation and weak wages growth will influence the next rates decision by the Reserve Bank of Australia (RBA) on 2 June.
“Locally anchored inflation outcomes, coupled with weak wage growth means that the RBA is firmly on hold with domestic interest rates for the medium term,” Mr Piotrowski said.
He also predicted a positive outlook for the Queensland economy.
“Spending and retail trade have both accelerated in recent times, after household spending picked up significantly in the second half of last year,” Mr Piotrowski said.
“Household spending growth in Queensland is likely to remain firm over the remainder of 2017.”
Looking abroad, Mr Piotrowski said the political climate in the US was influencing world markets, including Australia.
“The current political climate in Washington is creating a lot of volatility for the markets, but when you step back from that, the world’s biggest economy continues to do quite well,” he said.
Meanwhile, Antonia Mercorella, the CEO of the Real Estate Institute of Queensland, said that the good news was welcomed for Queensland.
“Our growth is steady and sustainable, but the factors underpinning our economy are fragile,” Ms Mercorella said.
“An uptick in wages growth, employment numbers and population growth would provide stronger scaffolding for the property market.”
Mr Piotrowski will be sharing more of his outlook on the economy at the 2017 Aon/REIQ Real Estate Luncheon on 26 May at Victoria Park Golf Complex in Brisbane.