Financial crisis in Australia ‘relatively contained’
Australia’s financial regulators are likely to keep the country in good stead as growth in gross domestic product weakens.
The latest OECD Economic Outlook shows GDP in Australia will most likely weaken from 2.5% this year to 1.75% next year before picking up to 2.75% in 2010.
“This would still imply that, despite the depressed international environment, the impact of the financial crisis and the fall in the terms of trade should be relatively contained,” the report said.
It predicts unemployment will increase though and inflation may dip below 3% in 2010.
The report says the slowdown shows the need to preserve the stability of Australia’s financial system and militates for “looser monetary conditions”.
“The recent budget measures, made possible by the significant fiscal leeway built in the previous years, will also support activity, although their effectiveness might be limited if confidence is not restored.”
The latest OECD Economic Outlook shows GDP in Australia will most likely weaken from 2.5% this year to 1.75% next year before picking up to 2.75% in 2010.
“This would still imply that, despite the depressed international environment, the impact of the financial crisis and the fall in the terms of trade should be relatively contained,” the report said.
It predicts unemployment will increase though and inflation may dip below 3% in 2010.
The report says the slowdown shows the need to preserve the stability of Australia’s financial system and militates for “looser monetary conditions”.
“The recent budget measures, made possible by the significant fiscal leeway built in the previous years, will also support activity, although their effectiveness might be limited if confidence is not restored.”