CEO Update: Theres little room for complacency as 2026 gets into full swing

With the Australian Open now over, it is down to business in earnest, with no shortage of important challenges and opportunities to lean into.

On the economic front, recent data releases confirm Australia’s economy was in a relatively strong position as we closed out 2025, with strong employment growth, consumer spending and business conditions.

While this sets a positive foundation for activity into 2026, there is little room for complacency. Inflation is higher than expected, underpinned by sticky services inflation, leading to predictions of interest rate rises as soon as tomorrow.

Business investment has picked up, but needs to broaden, and both business and consumer confidence are heading in the wrong direction. Concerns about the sustainability of government spending are also in the spotlight.

This underscores the need to focus on productivity, innovation and dynamism over the year ahead if we are to maintain a strong economy and labour market without inflation picking up further. In case you missed it, CEDA research released in December highlighted the growth in excessively stringent regulation. Improving regulatory settings for business is one part of what must be a broader reform agenda.

Canadian Prime Minister Mark Carney’s recent speech to Davos, which I am sure many of you will have seen, demonstrates the need for action on this front. In unusually direct language, this speech highlighted the need for new approaches to ensure economic resilience domestically and internationally as we continue to observe the rupturing of institutions that had previously enabled international trade and investment.

Australia has benefited from and contributed to rules-based globalisation. Looking ahead, there are plenty of challenges as well as huge opportunities. Planning for and investing in them will be critical to our future economic strength.

These themes will be reflected in our work and programs throughout the year, and there is plenty on offer in CEDA’s upcoming program to help you better understand and navigate them, starting with our Navigating 2026 economic outlook series in capital cities around the country. Join us over the next month as we unpack the key forces shaping 2026.

We are also putting the finishing touches on our flagship annual State of the Nation conference, which will be held in Canberra on June 24-27. You will hear more about that in coming weeks.

While a strong economy is vital to Australia’s future prosperity, so too is a strong social compact. Recent events here and overseas remind us that we cannot take this for granted. We are excited to partner with CareerTrackers to host Martin Luther King III at a sold-out event in Sydney on Thursday centred on the importance of economic inclusion.

Join us in Perth on February 12 for In conversation with RBA's Sarah Hunter to hear directly from the Reserve Bank of Australia’s Chief Economist and Assistant Governor (Economic) Sarah Hunter, as she explores the RBA’s perspective on full employment and current conditions in the labour market.

Ahead of next month’s state election, South Australian Premier Peter Malinauskas will take to the CEDA stage on February 18 in Adelaide to outline his vision for the future of the state at Vision for South Australia.

And later this month, with NSW at a key juncture in its energy future, hear directly from sector leaders on how they are balancing supply, demand and security during periods of vulnerability, and planning for a resilient, sustainable energy future. Join us for Energy Security NSW on February 24 at Parliament House in Sydney.

Late last year we launched our new member portal to improve member experience and streamline event registration. The portal also enables you to complete your profile so that you receive more tailored information and personalised invitations for future events. Click here to register and get started (you only need to do this once).

To finish, I would like to warmly welcome pitt&sherry, Oxford Economics and the Australian Council of Social Service as new CEDA members. Thank you for joining us.