10 - Australia and the Global Economy

Summary

Australia’s extraordinary economic boom continued throughout the period covered by this volume. By the end of 2005, the economy had enjoyed fifty-seven quarters of consecutive economic growth: Paul Keating’s ‘recession we had to have’ was a distant memory. Unemployment fell to slightly more than 5 per cent, the lowest rate for three decades. The government’s budget was enjoying record surpluses. Australia’s economic growth rate in the period was substantially above that of the average for the Organisation of Economic Co-operation and Development (OECD), the grouping of leading industrialised economies. Australia’s ranking in the OECD on per capita income rose from eighteenth in the early 1990s to eighth by 2005. Astute intervention by the Reserve Bank of Australia through the imposition of a marginal increase in interest rates in early 2005 appeared to have succeeded in deflating the housing bubble and in ensuring a soft landing for the economy.