Australia raises growth forecasts

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The Reserve Bank of Australia (RBA) has said that the country's economy is growing faster than had been expected.

It has more than tripled its growth forecast for this year from 0.5% to 1.75% and raised its 2010 forecast from 2.25% to 3.25%.

Last month, Australia became the first G20 country to raise its interest rate, taking it from 3.25% to 3.5%.

It was one of the few economies to avoid recession, having only contracted in the last three months of 2008.

The RBA' s quarterly Statement on Monetary Policy said that interest rates would have to rise gradually as the economy expanded.

'Big picture positive'

"The RBA here is foreshadowing years of expansion based on resources, population and Asian demand," said Su-Lin Ong, senior economist at RBC Capital Markets.

"It's big picture positive for Australia and the Australian dollar, and means rates are going nowhere but up."

http://news.bbc.co.uk/2/hi/business/8346130.stm

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1. now that's interesting. nt