Weekend Economist: 2018 is the worry

Between now and 2015-16, the government's growth forecasts are a little cautious. Heading into 2017-18, however, they're far too optimistic.

The government has revised up its growth forecast for 2013-14 from 2.5 per cent in MYEFO to 2.75 per cent but retained its 2014-15 and 2015-16 forecasts of 2.5 per cent and 3 per cent respectively. The refusal to recognise that this lift in growth momentum will be sustained appears to hinge on a strange assumption that the recent acceleration in export momentum will not be sustained.

In contrast, Westpac expects growth to lift from 2.75 per cent in 2013-14 to 3 per cent in 2014-15.

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