Delivering a colourful keynote address on the first day of the Resources Rising Stars conference on the Gold Coast, Caton said the Australian market was up 12% so far this year and the past quarter was the best quarter in four years.

“Gains from here are going to be harder to make,” he said.

Caton said the election didn’t make much of a difference, aside from providing a boost in confidence.

“Which has already taken place,” he noted.

Caton doesn’t expect another rate cut when the Reserve Bank of Australia meets this afternoon but he is concerned about the unemployment rate.

“If this trend continues, the unemployment rate will be worse than it was at the worst part of the GFC,” he said.

By the end of June 2014, Caton expects the Australian dollar to have fallen to US83c.

“It’s got to come down one day,” he said.

“I’m not convinced this is over yet.”

On the growth front, Caton expects Australia to be the best performer of the developed countries over the next 10 years, with gross domestic product growth of 3%.

Over the next 10 years, both China and India would have growth of around 7%.

“The Indian growth story is going to keep on coming,” Caton said.

But he warns that India won’t be the resources powerhouse China is.

“China has been a magnificent story for Australia,” he said, though the days of 10% growth were over.

“As we go forward, seven is the new 10. It will still be a good story, not a great story.”