Australian Govt. Concedes Country Has Fallen Into Recession
Bloomberg:
Stevens Says Australia Is in Recession, Will Rebound
Australia’s economy is in its first recession since 1991, central bank Governor Glenn Stevens said today, adding he is confident that stimulus measures, a strong banking system and a pickup in China will drive a rebound.
“I think the reasonable person, looking at all the information available now, would come to the conclusion that the Australian economy, too, is in recession,” Stevens said in Adelaide. Policy makers have undertaken a “rapid deployment of both fiscal and monetary measures, to support demand.”
Stevens’ comments echo those of Prime Minister Kevin Rudd, who said yesterday that a recession is inevitable amid slumping global demand for exports of the nation’s natural resources. Rudd today promised to provide economic stimulus in his May 12 budget in addition to the A$90 billion ($63 billion) in grants, spending and bond-market assistance announced since October.
The boost from government spending and the central bank’s record 4.25 percentage points in interest-rate reductions since early September “will still be coming through for some time yet,” Stevens said. The central bank most recently pared the benchmark rate to a 49-year low of 3 percent on April 7.
“There remain good grounds to think that we will continue to weather the storm better than most,” the governor said in his speech entitled “The Road to Recovery.”
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Stevens Says Australia Is in Recession, Will Rebound
Australia’s economy is in its first recession since 1991, central bank Governor Glenn Stevens said today, adding he is confident that stimulus measures, a strong banking system and a pickup in China will drive a rebound.
“I think the reasonable person, looking at all the information available now, would come to the conclusion that the Australian economy, too, is in recession,” Stevens said in Adelaide. Policy makers have undertaken a “rapid deployment of both fiscal and monetary measures, to support demand.”
Stevens’ comments echo those of Prime Minister Kevin Rudd, who said yesterday that a recession is inevitable amid slumping global demand for exports of the nation’s natural resources. Rudd today promised to provide economic stimulus in his May 12 budget in addition to the A$90 billion ($63 billion) in grants, spending and bond-market assistance announced since October.
The boost from government spending and the central bank’s record 4.25 percentage points in interest-rate reductions since early September “will still be coming through for some time yet,” Stevens said. The central bank most recently pared the benchmark rate to a 49-year low of 3 percent on April 7.
“There remain good grounds to think that we will continue to weather the storm better than most,” the governor said in his speech entitled “The Road to Recovery.”
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