RESERVE Bank Governor Glenn Stevens has again reiterated a good future for the local economy but the timeline for future interest rate hikes is still unclear, an economist says.
Mr Stevens said the economy is well placed to benefit from its ties to a growing Asia region.
But as the domestic economy continued to expand, there would be more changes to interest rates to keep price pressures under control.
ICAP senior economist Adam Carr said the RBA was currently holding back on interest rates while the economy continued to strengthen.
"They are, on the one hand, arguing that the prospects of the economy are pretty good,'' Mr Carr said.
"But they have demonstrated again a reluctance to tighten from a stimulatory setting.
"I don't think we are any wiser that they will hike in March.''
Mr Carr said RBA forecasts for gross domestic product (GDP) indicated the local economy would be growing on trend at about 3.25 per cent and interest rates would have to rise as a result.
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The RBA has forecast GDP to expand by about 3.25 per cent in 2010 and about three per cent in 2011 and 2012, on top of real growth of two per cent in 2009.
"That would imply that we are at the very minimum , at neutral,'' Mr Carr said.
"If we are 50 to 100 basis points to neutral, they have a bit of work to do.
"The way the economy is going, a near-term hike is very strong.''
Mr Stevens was answering questions at a hearing of the House of Representatives Economics Committee in Canberra.
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