A new report card on the ACT's economy gives a rare glimpse of a brighter future, buoyed by strong jobs growth, higher population growth and confidence among small businesses exceeding the national average.
As well, the housing market is looking slightly better and there has been a notable recovery in new car sales.
"But there's no reason to break out the bubbly," the Deloitte Access Economics December quarter 2015 Business Outlook cautions.
It reveals an alarming downward revision of state final demand in 2015-16, to -0.2 per cent, even lower than the ACT 2015-16 Budget review forecast of 2 per cent.
Also, despite saying there is some room for optimism, the report again points to question marks over the ACT economic outlook, due to its reliance as a "one company town" on the federal government.
"The ACT's recovery remains highly dependent on future moves in federal policy and although the most recently announced cutbacks were modest, the federal budget remains mired in red ink," it says.
"Yet although the federal budget outlook continues to cloud over, there's no immediate expectation that the ACT will be put to the sword by further rounds of cutbacks to federal spending.
"Rather, hopes have been raised in recent months that the worst of the cutbacks have passed.
"A range of economic indicators in the ACT suggest that there is room for some optimism.
"Job growth has recovered, and is currently the strongest in almost three years. And a solid lift in job vacancies suggests that the recovery has a firm basis and that further job gains may be ahead.
"Small business confidence has moved higher and is above the national average.
"Falls in petrol prices and lower interest rates have been a big positive in freeing up disposable income for Canberra's families, thereby providing support to the ACT economy.
"There are some mixed signs for the ACT's housing market."
The report says the Gungahlin to Civic light rail project looks set to proceed in 2016.
Chief Minister Andrew Barr said the report showed the ACT economy was recovering well from federal cutbacks.
"The Outlook highlights a solid lift in job vacancies, small business confidence has moved higher and is above the national average, improving population growth and increased disposable income, which is great news for our city," he said.
"If the Commonwealth keeps its word and there are no cuts in the next budget, the economic outlook for 2016 is broadly positive for Canberra.
"The territory government will continue doing our part to boost activity with a multibillion-dollar pipeline of infrastructure investment that will create thousands of jobs.
"We have also attracted significant new employers to Canberra including IKEA, Aquis and QantasLink.
"The ACT Government has a clear plan to support our local economy and attract new investment and entrepreneurs to our city.
"In particular we are focusing on growth in the internationally tradeable services sector.
"This includes areas like higher education, innovation and research, information and communications technology, tourism, the arts and creative industries, and health services."