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Australia able to avoid recession | Australia able to avoid recession |
(about 1 hour later) | |
The Australian economy has unexpectedly avoided falling into recession after its economy grew by 0.4% in the first three months of 2009. | The Australian economy has unexpectedly avoided falling into recession after its economy grew by 0.4% in the first three months of 2009. |
Increased exports and consumer spending helped the economy to rebound from the 0.5% contraction recorded between October and December last year. | Increased exports and consumer spending helped the economy to rebound from the 0.5% contraction recorded between October and December last year. |
Australian Prime Minister Kevin Rudd said the country was now the only advanced economy not in recession. | Australian Prime Minister Kevin Rudd said the country was now the only advanced economy not in recession. |
An economy is said to be in recession after two straight quarters of decline. | An economy is said to be in recession after two straight quarters of decline. |
Stimulus moves | Stimulus moves |
To help avoid the country falling in recession, the Australian central bank cut interest rates to a 45-year low of 3.25% in February. | To help avoid the country falling in recession, the Australian central bank cut interest rates to a 45-year low of 3.25% in February. |
We have technically avoided recession, but if you look at the details in the data it is not a pretty picture JP Morgan economist Helen Kevans | |
The government also introduced a number of multi-billion dollar stimulus packages, including increased infrastructure spending and cash handouts to most Australians since the end of last year to lift consumer spending. | The government also introduced a number of multi-billion dollar stimulus packages, including increased infrastructure spending and cash handouts to most Australians since the end of last year to lift consumer spending. |
Despite the economic growth in the first quarter of the year, Mr Rudd said Australia remained at risk of recession. | Despite the economic growth in the first quarter of the year, Mr Rudd said Australia remained at risk of recession. |
"We're not out of the woods yet, we've got a long way to go," he said. | "We're not out of the woods yet, we've got a long way to go," he said. |
Analysts agreed that the risk of recession remained as 2009 continues. | |
"We have technically avoided recession, but if you look at the details in the data it is not a pretty picture," said Australian-based JP Morgan economist Helen Kevans. | |
"We have imports falling off a cliff, which is a symptom of firms smashing investment and which is bad for our employment outlook." |
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