AUSTRALIA SET TO GROW, BUT UNEMPLOYMENT MAY RISE
Australia's economy should manage modest
growth over the next two years after a sharp slowdown but
unemployment could still edge upwards, the Organisation for
Economic Cooperation and Development (OECD) said.
    The organisation's latest half-yearly report says Gross
Domestic Product will grow by 2.5 pct this year and by 2.75 pct
in 1988 compared with only 1.4 pct in 1986. The growth will be
helped by higher stockbuilding and stronger domestic demand
following tax cuts and higher real wages, it added.
    The report forecasts a decline in inflation, with consumer
prices increasing by 8.5 pct this year and 6.25 pct in 1988.
    The current account deficit shows signs of easing slightly
and could narrow to 12 billion dlrs by the end of 1988.
    While predicting slightly stronger growth than last year,
however, the report revises downwards the OECD's earlier growth
forecast for 1987 of 3.75 pct.
    The OECD predicts a similar combination of modest economic
growth and rising unemployment for New Zealand, which is
struggling to recover from a major economic crisis.
    The country's GDP, which contracted by 0.6 pct last year,
should again show growth over the next two years, rising by
0.25 pct this year and a more substantial 2.75 pct in 1988.
 Reuter
