Australia's economy may have escaped the shocks that rocked other markets in recent years but it may not be so lucky going forward, according to one cross-asset strategist. Dylan Grice at Societe General, warned against complacency in a note out this week, saying that Australia has five of the world's most expensive cities when looking at median price to median income. Australia has also seen an explosion of household debt and is running a current-account deficit despite massive improvement in the terms of trade from high commodity prices, he said. Australia is in a precarious position, he said, as the economy depends on Chinese resource demand holding up. And even if it does, Grice said that Australia's current-account deficit means that the Australian dollar is "overvalued and vulnerable."

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