The peaceable continental country known as the Lucky Country may finally be joining the rest of the Anglo-Saxon world in poor economic times, as noted in Bloomberg's Australia Faces the ‘Full Brunt’ of Global Recession:
Australia’s economy, which has so far skirted the global recession, may stall after reports showed exports dropped to a 14-month low, bank lending fell and home- building approvals declined by the most since 2002. . .
This week’s reports suggest the global recession is biting as stimulus efforts fade, which may prompt the central bank to cut interest rates. Reserve Bank Governor Glenn Stevens said last month that slower growth and inflation give him scope to reduce borrowing costs if it helps secure “a durable upswing.”
“The full brunt of the deepest and most synchronized post- war global recession has yet to fully bear down on Australia,” said Su-Lin Ong, Sydney-based senior economist at RBC Capital Markets. “Export income, the terms of trade and business investment are all set to move substantially lower in 2009.”
Weakness in Australia may also imply greater economic weakness in China than the Chinese Government would like to admit.
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