Hopes rise for Australia's economic growth prospects

But a better-than-expected trade balance for the December quarter, alongside stronger business inventories and increased government spending, spurred economists at NAB and Westpac to lift their GDP growth predictions for the last three months of 2024 to 0.7 per cent.

If realised, that would translate to a 1.4 per cent expansion in the economy over the year, NAB head of market economics Tapas Strickland said.

In its February Statement on Monetary Policy, the Reserve Bank predicted year-end growth to come in at just 1.1 per cent.

"While growth looks to have surprised in Q4, the more important aspect is the trajectory and the implications for inflation," Mr Strickland said.

In its February meeting minutes, released on Tuesday, the Reserve Bank board noted activity in the Chinese economy was expected to slow and uncertainty around US tariff policy threatened global GDP forecasts.

Later on Tuesday, China announced it would slap retaliatory 15 per cent tariffs on a range of US agricultural imports.

An all-out trade war heightens the risk of a slowdown in China's economy and the flow-on reduction to Australia's economic output.

Much will depend on how much stimulus China's legislature, the National People's Congress, announces at its opening session beginning on Wednesday,

Treasurer Jim Chalmers said there were good reasons to believe the Australian economy was turning a corner.

"Interest rates coming down means something like an extra $5 billion pumped into our economy over 12 months," he told reporters on Tuesday. 

"It will have a positive impact on growth and living standards, combined with what we've been able to do to get real wages growing again to make sure that people are earning more and keeping more of what they earn in an economy where unemployment is remarkably low. 

"All of these things augur well for our economy in 2025."