After a year of global recession, Australia could be one of the world’s first major countries to start raising interest rates owing to its faster than expected recovery from the economic crisis. The Reserve Bank of Australia upgraded its forecast for the GDP for the remaining of 2009 and 2010, underlining the resilience of the Australian economy worth AUS$1.1 trillion.
According to the central bank, GDP is now expected to grow 0.5% in the fourth quarter this year, up from the forecast of a 1% contraction three months ago. Therefore, Australia could eke out a little growth for 2009, while the US and the European countries still seem on track to report major contractions.
According to predictions made by JP Morgan, Australia is likely to grow 0.3% this year while the US, Europe and Japan are likely to contract by 2.6%, 4.4% and 5.4% respectively.
Economists are watching which countries start to increase the rates of interest, after most of the major economies, including the United States, had been slashing rates over the past year.
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