Australia's strong economic growth rebound from last year's steep recession looks set to extend over 2021 and into 2022.
The Westpac-Melbourne Institute leading index for April, which indicates the likely pace of economic activity growth three to nine months into the future, continues to point to above trend annual growth at around 2.8 per cent.
"The signal is consistent with Westpac's growth forecasts for the Australian economy," Westpac senior economist Matthew Hassan said.
The bank expects a very strong growth rate of 4.5 per cent in 2021 and then moderating marginally to a four per cent pace in the first half of 2022 even as the impact from the end of last year's COVID-19 lockdowns unwinds.
"With initial reopening rebounds now largely complete, other drivers are set to take over with upbeat, cashed-up households and booming housing markets setting what will still be a strong pace for growth," Mr Hassan said.
In the near term, economists will begin fine-tuning their growth forecasts for the first three months of this year as the Australian Bureau of Statistics rolls out a series of quarterly indicators over the coming week.
The March quarter national accounts, which will provide the latest economic growth result, are due on June 2.
"At this stage we expect the GDP data to confirm that the economy regained its pre-COVID level of output during the first quarter of 2021 - a stunning achievement compared to what was expected," ANZ economists say.
In the second half of last year, and for the first time in at least 60 years, the economy grew by more than three per cent in two consecutive quarters.
What is known so far for the March quarter, retail spending will be a modest drag on growth, after declining 0.5 per cent, following a relatively large 2.4 per cent increase in the December quarter.
Otherwise, the quarterly reports season kicks off with construction work figures on Wednesday.
Economists expect a two per cent rise in the March quarter after the 0.9 per cent drop in the previous three months, largely rebounding on the strength of home building on the back of government initiatives and low interest rates.
