Australia revises growth forecast downwards
Australia has today revised its annual growth forecast from 3.25% to 3% due to uncertainty surrounding the global economic recovery.
Australia is one of the few developed economies not to have fallen into recession like its counterparts throughout the world as it has benefited from an increase in commodity prices, while exports have received a boost due to demand from China for its iron ore and other raw materials.
It was the first economy to raise rates from a 50-year low as the economic downturn eased. Other major economies opted for lower interest rates to boost their economies.
Its jobs market remains strong after employment hit a record high of 11.1 million people at work.
According to the Australian Bureau of Statistics, the economy created almost 46,000 jobs last month – smashing analysts forecasts of 15,000.
The latest figures means the unemployment rate held steady at 5.1% and is expected to fall further to 4.75% in 2011-2012 – which differs to Europe and the US, who are seeing double digit unemployment.
However, today’s revisions suggests the Australian economy, labelled as the “wonder from Down Under” is not completely immune to global volatility.
In a statement, the Government said: “Since the 2010-2011 budget, uncertainty around the global economic recovery has increased.
“Despite this increased uncertainty and renewed volatility in global financial markets, the outlook for the domestic economy remains positive,” it added.
Meanwhile, Australia is tackling wide-ranging tax reform to spread the benefits of economic growth, but encountered many difficulties over a tax which was aimed at the mining industry.
The controversial tax led former Prime Minister, Kevin Rudd, to step down and he was replaced by Deputy PM, Julia Gillard.
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