Multinational financial services giant Morgan Stanley has predicted a year of slow economic growth for the nation. According to the report, the Australian economy will display its slowest expansion since 2009.
Morgan Stanley's economists added to the recent discussion on the sliding Australian dollar, forecasting a drop to 76 US cents in 2015. Also during the year, the sharemarket could fall as low as 4400. In such a context, the report sees interest rates remaining at a record low of 2.5 per cent for the duration of the year.
However, the Sydney Morning Herald's Stephen Cauchi reminded readers that negative growth is not part of Morgan Stanley's overview, but, rather, slow growth will result in a total 2015 GDP growth figure of 1.5 per cent. Mr Cauchi also placed the Morgan Stanley predictions alongside those of Bloomberg, which was more optimistic with a average GDP forecast of 2.54 per cent, and government bodies:
"Federal Treasury is tipping 2.5 per cent growth in 2015 and the Reserve Bank has flagged expectations of between 2.5 per cent and 3.5 per cent growth."
The conclusion of the Morgan Stanley report describes Australia's domestic demand in 2015 as "close to recessionary levels".