Ouch! Governor Stevens’s return fire must have hurt Uncle Joe. Not sure about the strength of a recovery but I agree with “The longer you wait, the more ammunition you will end up having to use,” Mr Stevens said. “These things can get a sort of self-fulfilling momentum behind them.”
THE combined impact of rate cuts and the Rudd Government’s stimulus packages will create an economic recovery later this year, according to the Reserve Bank, starting with a revival in housing construction.
The bank’s governor, Glenn Stevens, endorsed the Government’s economic strategy yesterday, saying its two economic stimulus packages would boost economic growth both this year and next.
He also said the Government’s actions to guarantee both bank deposits and wholesale funding had preserved confidence in the banking system.
Appearing before the House of Representatives economics committee yesterday, Mr Stevens said the prompt actions of both the Reserve Bank and the Government would reduce the severity of the downturn.
“The path of the Australian economy is going to be considerably better than it would otherwise have been, and considerably better than a number of other countries around the world, whom we can see contracting at a very large pace,” Mr Stevens said.
He disagreed with new Opposition Treasury spokesman Joe Hockey that the Government should be saving some of its ammunition in case the downturn was protracted.
“The longer you wait, the more ammunition you will end up having to use,” Mr Stevens said. “These things can get a sort of self-fulfilling momentum behind them.”
Over To You
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