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set to be eased back as the country hits "recovery phase" after
shrugging off the worst global economic crisis in decades. Reserve
Bank of Australia (RBA) governor Glenn Stevens said interest rates
would be lifted off 49- year lows to keep a lid on inflation as the
domestic economy rises from its "mild downturn". "I think it is
reasonable to conclude, against the benchmarks of historical and
international experience, that Australia has done quite well on this
occasion," he told a Senate committee hearing. Australia moved a 70
billion dollar (61 billion US) stimulus package and slashed rates to
3.0 percent as the world economy dived, helping it avoid recession
and post world-beating growth of 0.6 percent in the June quarter.
"In due course, both fiscal and monetary support will need to be
unwound as private demand increases," Stevens said. "In the case of
the fiscal measures, this was built into their design. The peak effect
of these measures on the rate of growth of demand has probably
already passed." The central bank chief said strong demand from Asia,
particularly China, for Australia's vast resources had lifted the
economy and brightened prospects for the future.
