Australia's growth prospects downgraded by IMF on commodities dependence

The International Monetary Fund's 2013 growth forecast for Australia has been moderately reduced due to the country's significant exposure to international commodities markets.

The IMF's latest World Economic Outlook has reduced the forecast for Australian growth next year to 3% from 3.5% as predicted in April.

Australia's significant dependence on commodities export is a key reason for the downgrade in its growth prospects, with the slowdown in the Chinese economy leading to a decline in spot prices for stalwart resource exports such as iron ore and coal.

The fund does not anticipate a sharp contraction in growth, however, and forecasts only a modest uptick in unemployment. The jobless rate is expected to rise from 5.1% at present to 5.3% next year, with the ongoing effects of the mining investment boom insulating the employment market from some of the Asia-wide slowdown.

The downgrading of Australia's growth outlook would appear to vindicate claims that the country's mining boom has reached its end, which first came to prominence with impromptu remarks by resources minister Martin Ferguson.