Australian profits, the economy and shares by Shane Oliver, Head of Investment Strategy & Chief Economist

Key points

• June half profit reports were poor consistent with sluggish June quarter GDP growth of 0.6% or 2.6% year on year. 
• On a 12 month horizon however, a reduced cost base, low interest rates and a lower $A point to stronger economic growth and profits.
• The share market has moved up ahead of profits and while gains are likely to slow, they are likely to remain decent on a 12 month view as profits start to improve.

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