Australia faces tough economic times even if peace talks are successful — Capital Brief


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The best-case scenarios from the US-Iran negotiations still leave Australia with significant economic challenges.

Reserve Bank officials will speak this week. Economists will be listening closely for the latest thinking on the Middle East conflict.
AAP Image/Lukas Coch.

The attention of the world is once again on the Middle East as peace talks continue. But even if they’re as successful as hoped, Australian economists fear it will be a rough period ahead for inflation and growth.

Here’s what you need to know about the key economic data releases this week.

Ceasefire yet to ease economic fears

The news: US-Iran peace talks continue

The economic outlook: Forecasters were back to the drawing board after the announcement of a two-week ceasefire. But there’s significant uncertainty about the path ahead as peace talks continue.

Commonwealth Bank economists rapidly changed their base case expectation following news of a ceasefire last week to slash the length of the war, with an end now expected in May rather than June. Even so, they warn the negotiations are expected to be “difficult” with incompatible goals on both sides.


Topics:
Forward Guidance,
Economy,
Geopolitics

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