Appendix H Detailed economic forecasts

The table below shows the Government's macroeconomic forecasts(a). The Australian economy is expected to grow by 2 per cent in 2013‑14 and 3 per cent in 2014‑15. More comprehensive information is provided in Budget Paper No. 1, Budget Strategy and Outlook 2012‑13, Statement 2.

Appendix H - Detailed economic forecasts
Outcomes (b) Forecasts
2011‑12 2012‑13 2013‑14 2014‑15
Panel A - Demand and output(c)
Household consumption3.22 1/233
Private investment
Dwellings-3.61/255 1/2
Total business investment(d)20.810 1/24 1/21
Non-dwelling construction(d)37.618 1/25-2 1/2
Machinery and equipment(d)10.11 1/22 1/25
Private final demand(d)6.243 1/22 3/4
Public final demand(d)2.3-1/201/2
Total final demand5.332 3/42 1/4
Change in inventories(e)-0.1000
Gross national expenditure5.232 3/42 1/4
Exports of goods and services4.776 1/27
Imports of goods and services11.8563
Net exports(e)-1.31/201
Real gross domestic product3.432 3/43
Non-farm product3.332 3/43 1/4
Farm product9.0-840
Nominal gross domestic product5.03 1/455
Panel B - Other selected economic measures
External accounts
Terms of trade0.4-7 1/2-3/4-1 3/4
Current account balance (per cent of GDP)-2.7-3 1/2-3 3/4-3 1/4
Labour market
Employment(f)1.21 1/41 1/41 1/2
Unemployment rate (per cent)(g)5.15 1/25 3/45 3/4
Participation rate (per cent)(g)65.3656565
Prices and wages
Consumer price index(h)1.22 1/22 1/42 1/4
Gross non-farm product deflator1.7021 3/4
Wage price index(f)3.73 1/23 1/23 1/2

(a) Percentage change on preceding year unless otherwise indicated.

(b) Calculated using original data unless otherwise indicated.

(c) Chain volume measures except for nominal gross domestic product which is in current prices.

(d) Excluding second‑hand asset sales between the public sector and the private sector.

(e) Percentage point contribution to growth in GDP.

(f) Seasonally adjusted, through‑the‑year growth rate to the June quarter.

(g) Seasonally adjusted rate for the June quarter.

(h) Through‑the‑year growth rate for the June quarter.

Note: The forecasts for the domestic economy are based on several technical assumptions. The exchange rate is assumed to remain around its recent average level — a trade‑weighted index of around 78 and a US$ exchange rate of around 103 US cents. Interest rates are assumed to move broadly in line with market expectations. World oil prices (Malaysian Tapis) are assumed to remain around US$106 per barrel. The farm sector forecasts are based on average seasonal conditions.
Source: Australian Bureau of Statistics (ABS) cat. no. 5206.0, 5302.0, 6202.0, 6345.0, 6401.0, unpublished ABS data and Treasury.