Australian growth to pick up
“Australia and the Republic of Korea are projected to see a pickup in growth in 2026, underpinned by stronger domestic demand,” the report said.
“In Australia, real GDP growth is estimated at 1.8 per cent for 2025, compared with 1.1 per cent in 2024. The economy is projected to expand by 2.2 per cent in 2026 and 2.4 per cent in 2027,” it said.
“Strong wage growth has supported a recovery in private consumption, while private investment has remained relatively weak even in the wake of monetary easing by the Reserve Bank of Australia starting in February 2025.”
“We are more optimistic about the US economy in 2026 because of tech spending.”
– Joseph Capurso, CBA Head of Foreign Exchange, International & Geoeconomics
US economy set to slow
The report said economic growth in the United States slowed to 1.9 per cent in 2025 – from 2.8 per cent in 2024 – and was forecast to edge up to 2.0 per cent in 2026 and 2.2 per cent in 2027, aided by expansionary fiscal and monetary policies.
It said inflation would likely remain above the two per cent target in 2026, “though it should gradually moderate as tariff effects wane and housing costs stabilise”.
Commonwealth Bank Head of Foreign Exchange, International & Geoeconomics Joseph Capurso said there could be more growth in US than the UN is predicting. “We are more optimistic about the US economy in 2026 because of tech spending,” he said. “We forecast US economic growth to pick up to 2.4% in 2026 compared to the UN’s forecast of 2.0%.
In China, the economy was projected to grow by 4.6 per cent in 2026 and 4.5 per cent in 2027, down from an estimated 4.9 per cent expansion in 2025.
“A temporary easing of trade tensions with the United States – including targeted tariff reductions and a one-year trade truce – has helped stabilise confidence, while policy support is expected to sustain domestic demand,” the report said.
Reuters