The chairman of the US Federal Reserve, Ben Bernanke, overnight made his strongest suggestion yet that the world's largest economy was headed for a recession.

But growth continues to be the main feature of the domestic economy - growth that comes down to the Chinese-fuelled commodities boom.

Treasury's chief forecaster David Gruen has told business economists in Sydney that Australia tops the ranking of the 30 OECD countries as a beneficiary of China's thirst for resources.

"It should be little wonder then, that Australia's macroeconomic circumstances differ so substantially from those of most of the developed world," he said.

Dr Gruen says Australia's terms of trade are the highest they have been since the wool boom of the 1950s.

"There is significantly more to come," he said.

"Huge rises in bulk commodity prices are now in prospect for mid-2008."

To offset the inflationary impact of vast resources sector investment, other parts of the economy will need to grow quite slowly.

But Dr Gruen believes a soft landing for the economy is achievable.

Source: By Australian Broadcasting Corporation