June 2, 2009 10.01 p.m. Montréal time
Australia released its first quarter GDP numbers and much to the surprise of analysts there was positive growth of 0.4 % in the first quarter. This means that technically Australia has avoided a recession having only experienced one quarter of negative growth.Unemployment has risen and economic activity slowed but growth is still positive.the Australian central bank has cut interest rates and the Government has introduced a 50 plus billion Australian dollar stimulus. Because imports fell more dramatically than exports an additional 1.6 % was added to the GDP.
Avoiding a technical recession is good news not only for down under but for the global economy generally.It is one more sign of some positive signs of gradual recovery in global circumstances. The Australian dollar which has been rising in recent days rose in response to the news and the shares of Australian companies appear to be responding positively to the news.
Australia, like Canada, is very rich in natural resources and closely integrated with the economies of Asia. As Australia and China lead the way forward the momentum may well spread. ( As the owner of a small number of shares in an Australian steel company I am pleased to see the news.)
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