Australia economic fundamentals remain strong despite market slump: PM

Australia economic fundamentals remain strong despite market slump: PM

Australian Prime Minister Julia Gillard on Friday moved to soothe investors nerve after a slump in share market, saying that Australia has strong economic fundamentals.

Local share market closed firmly in the red following tumbles on Wall Street and European bourses overnight, with the benchmark ASX 200 index down 61.7 points, or 1.56 percent, at 3,903, while the broader All Ordinaries index was down 66.2 points (1.64 percent) at 3,978.

The Australian dollar also tumbled to a 10-month low below 97 U. S. cents, before making a partial recovery as one global credit rating agency affirmed Australia's AAA rating, and the central bank gave the nation's banks a relatively clean bill of health.

Gillard said she understands people are concerned when they see volatility in the markets.

"Whether it's today or yesterday or the day before or whether it's tomorrow, whatever we see on international markets in the time in between, the fundamentals of the Australian economy are strong," she told reporters in Canberra.

"Low unemployment, low public debt, a strong banking system, growth, employment prospects, record terms of trade, hundreds of billions of dollars in the investment pipeline.

"So, if you go back 48 hours, if you go forward 48 hours, those fundamentals are there throughout. People should remember that even as they see this turmoil on international markets."

However, Opposition Leader Tony Abbott warned that fears of a global double dip recession are growing.

"This is hardly the time for the government to be congratulating itself on its economic management or complacently assuming that the Australian economy can readily cope with more debt and higher taxes," he said.

Global rating agency Standard & Poor's affirmed Australia's long-term AAA credit and stable outlook.

"The ratings on Australia reflect Standard & Poor's view of the country's ample fiscal and monetary policy flexibility, economic resilience, public policy stability and its sound financial sector, " credit analyst Kyran Curry said in a statement on Friday, adding that these factors demonstrate Australia's strong ability to absorb large economic and financial shocks, such as the global recession in 2009.

Editor: Wang Guanqun

English.news.cn   2011-09-23 17:00:23 FeedbackPrintRSS
CANBERRA, Sept. 23 (Xinhua)