Swan Says Australia Stimulus Shouldn’t Be Withdrawn Prematurely
The Australian government’s plan to gradually withdraw stimulus spending that is helping the economy recover is appropriate and shouldn’t be accelerated, Treasurer Wayne Swan said.
While the economy has “proven its resilience” to the global recession, “significant challenges and risks remain,” Swan told economists at a function in Sydney today. “We still expect the economy will operate below capacity for a while yet and for the unemployment rate to continue to rise.”
The government is spending A$22 billion ($20 billion) on railways, roads and schools to help spur domestic demand guaranteed payday loan. Central bank Governor Glenn Stevens unexpectedly raised the benchmark lending rate last week from a half-century low, becoming the first Group of 20 policy maker to increase borrowing costs since the height of the global financial crisis.
“Just as all of the monetary policy stimulus won’t be withdrawn overnight, nor should the fiscal stimulus be withdrawn sharply or prematurely either,” Swan told a lunch organized by the Australian Business Economists.
Filed under: business by Specialist