Today's quarterly health check of the economy from the Reserve Bank shows show quickly sentiment can change especially in periods of uncertainty when the default settling can be low expectations.
This time yesterday, economists were in "doom and gloom" mode after the ABS posted the surprise result that Australia's official jobless rate had spiked to 6.3 percent in July.
Now the RBA is painting a "less worse than expected" scenario and signalling that the July result might have been an aberration given that the jobs reading is known for its volatility.
In an unusually positive update, the RBA says Australia's jobless rate may have peaked and will stabilise before falling, according to the Reserve Bank's latest quarterly health check of the economy.
"Labour market conditions are generally better than expected a few months ago, though spare capacity remains," the statement says.
"The unemployment rate is forecast to be lower than previously anticipated.
"There has been a pickup in labour demand which has led to a noticeable rise in the employment to population ratio."
The RBA now believes the jobless rate will remain "little changed" over the next 18 months from a level that is "a bit lower than forecast" before declining in 2017.
The RBA's forecasts contradict some market economists who believe the jobless rate could still peak above 6.5 percent.
Australia's economic growth is also looking more positive with the RBA expecting it to pick up gradually to exceed three percent by 2017.
Despite the end of the mining investment boom, the RBA expects losses to be offset by strong growth in resource exports.
However, the RBA has also restated its concern that the transition from the mining boom to other non-mining parts of the economy is taking longer than expected.
"Businesses are waiting to see a sustained increase in demand before committing to major new investment projects," the statement says.
"Mining investment continues to decline as more projects reach completion but few new projects commence."
With concerns about the debt crisis in Greece abating, the RBA says the focus has shifted to how financial markets reactwhen the US Federal Reserve starts raising interest rates for the first time since 2006.
"This is expected to occur before the end of the year and is likely to be associated with an increase in global financial volatility."
The Reserve Bank believes once the Federal Reserve moves there will be an impact on the Australian dollar "which will depreciate further once the tightening commences."
On concerns about a real estate bubble in Sydney and Melbourne, the RBA noted that commercial banks had increased rates on investor lending after the Australian Prudential Regulation Authority (APRA) implemented measures to address the