The Organisation for Economic Cooperation and Development, in its latest Economic Outlook, expects Australian economic growth to slip below three per cent by the end of 2016 and stay there until 2018.
The economy was expanding at an annual 3.3 per cent pace as of June. However, Treasurer Scott Morrison says the economy is still growing faster than the OECD average.
"We are growing faster than Canada, the United States, United Kingdom, Germany, France, Netherlands, Japan, Singapore, New Zealand," Mr Morrison told parliament on Tuesday.
The Organisation for Economic Cooperation and Development says it expects the economy will have grown at 2.7 per cent in 2016, and slower than the 3.3 per cent annual rate as of June.
The OECD expects by 2018 unemployment will be lower at 5.3 per cent, from 5.6 per cent now, and inflation will be a more normal 2.1 per cent.
As such it doesn't envisage the Reserve Bank of Australia will cut its key interest rate any further and will be raising the rate by late 2017.
It believes a rate hike would help tame tensions in the housing market, which has experienced rising prices in many places for some time.
