Signs the economic fallout from the Iran conflict may be shorter-lived than feared.

Westpac economists are forecasting brighter outlooks for inflation, interest rates and the wider economy, as fuel price concerns ease.

They expect GDP growth to reach two percent this year, while inflation is forecast to peak this quarter before declining.

Chief Economist Kelly Eckhold told Mike Hosking the oil market has been more resilient than many expected.

He says headline inflation globally isn't rising as quickly, and the urgency central banks previously felt to raise rates is no longer there.

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