Australian economy poised for strong growth

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SYDNEY, Aug 22 (AFP): The Australian economy is set for strong growth in 2007 and 2008 as household spending remains robust and resource exports continue to boom, according to a survey released today.
The Westpac-Melbourne Institute leading index, which indicates the likely pace of economic activity three to nine months into the future, was 7.1 per cent in June, well above its long-term trend of 4.5 per cent.
Westpac chief equities economist Bill Evans said a number of factors were pointing to growth of 4.0-4.5 per cent in both 2007 and 2008.
"A strong labour market, rising real wages and tax cuts will support household spending," he said.
"Five years of solid investment growth are now beginning to pay off for the resources industry with exports of resources gathering pace.