yield ” has intensified. world gdp growth is thought to have been about 3¼ per cent in 2012 – a little below average. forecasts for 2013 are for something a bit higher than that, with a further pick - up in 2014. those seem reasonable guesses at this point in time. risks now seem less tilted to the downside than they were. australia ’ s terms of trade have declined by about 17 per cent since their exceptional peak in the middle of 2011. we are assuming they will fall further over the next couple of years. even with that, however, they will probably be more than 50 per cent above their twentieth century average over that period. this amounts to an external environment for australia that, while not without some challenges, is still broadly positive. turning to the australian economy, the information we have at present suggests that growth was close to trend over 2012 as a whole. there was, though, some softening around the middle of the year, and sentiment among many businesses, including some that had seen important positive spillovers from the mining boom, became less optimistic. associated with this, the labour market softened in the second half of the year, with job vacancies declining, employment growth slowing, and unemployment increasing somewhat. labour force participation also declined. bis central bankers ’ speeches looking ahead, it appears that the peak in the level of resource sector investment is now close. it is a very high peak, but we do not think that there will be a rapid decline in the near term after the peak. however, it seems pretty clear that this type of investment will not be adding to demand for much longer. investment spending by businesses in other sectors has thus far remained somewhat subdued in comparison. there are good reasons to expect it will strengthen in due course, but the available indicators at present do not suggest that is going to happen in the very near term. we will get another reading on the investment outlook next week. the outlook for public spending is being constrained as a result of the budgetary restraint being pursued by governments. it is also noteworthy that in several sectors of the economy a combination of factors is putting pressure on business models, and firms have been responding with an emphasis on lifting productivity and paring back costs. this process, while unavoidable, doubtless feeds into measures of sentiment. sentiment of households, in contrast, has improved. despite continual commentary that households are very cautious, actual measures of confidence have in fact shown an upward trend since the middle of

the payer and receiver have their accounts with different institutions. the payments system board believes that australia should develop such capability over the medium term, and proposed a target for the payments industry to achieve that goal by the end of 2016. the board met last week and reviewed an industry proposal for real - time payments that was submitted to the bank in late 2012. the board considers that the industry has made good progress and endorsed the proposal in an announcement earlier this week. there are many details to be resolved that will require the bank and industry to work closely together over the next few years, within a governance framework that gives appropriate voice to the various stakeholders. but we view this as a very positive development and we welcome the industry ’ s commitment to deliver world - class improvements to the payments system by the end of 2016. my colleagues and i are here to respond to your questions. bis central bankers ’ speeches