Economic Conditions of the Australian Economy
Over the past five years the Australian economy has gone through many changes experiencing both the peaks and troughs associated with business cycle.
Five years ago, in the middle of 1997 Australia’s economic growth had begun to upturn after a period of recession during the ’96 year. This was unmistakably shown through the composite indicators of retail trade, dwelling investment and Australian share market valuations, all concurring with one another and demonstrating the effects of an upturn in economic growth.
This economic growth continued to increase through ‘98 and ‘99, partly being attributed to the weakening Australian dollar that allowed for the opening up and increasing market shares held by Australian exports on world markets. This was the case, as the reduction in the Australian dollar’s value, triggered decreases in the prices of our exports for foreign buyers, thereby increasing demand for our products and increasing the amount of money and investments coming into Australia. This therefore resulting in the aforementioned increases economic growth when combined with the high levels of employment and consumer confidence.
This economic growth didn’t however continue for long, with the economy peaking just before the start of the year 2000 followed by a sharp downturn that resulted in a temporary recession occurring around the middle of the year. This erratic behavior, most pronounced in retail trade, can be explained by the effects of both the millennium bug and the introduction of a general consumption tax in the form of the GST. The millennium bug caused much panic and with it bought panic spending especially in the IT sector thereby over inflating an already close to booming economy and after the non-event that the millennium (or Y2K) bug caused spending slumped and then further slumped due to the holding back of consumer spending on big ticket items such as cars and houses until the introduction of the GST.
In spite of the aforementioned pre GST economic slump, in the second half of 2000, with the implementation of the GST and the advent of the Olympics, the economy quickly boomed again before experiencing another sharp downturn followed by an equally sharp upturn. The initial upturn was due to increased post GST spending followed by huge foreign cash injections into the Australian economy as a result of the Sydney Olympic Games. The Olympics spending however was only temporary and consequently caused a post Olympics downturn, which was quickly countered by the introduction of the first homeowners grant.
The global economy has been recovering from the financial crisis which occurs in 2008, then has a weak growth for most developed countries over 2012 and 2013. But economic activity in Canada has expanded at a faster pace than most other major advanced countries in 2012; however, economic performance in Canada has been unsteady throughout 2013 (The Economic review, 2013). After the last quarter in 2010 GDP growth rate grows rapidly, the GDP grows slowly but steadily in 2012 which remains at around 3 percent. Real GDP growth rate in Canada grows slowly in the first quarter of 2013, but increased by 5 percent in the second quarter ,then remains the same level until the first quarter of 2014 (Statistics Canada, 2014). In 2014, the Canadian government take a series economic action plan as a guide for the economy development such as improving investment conditions, ...
In conclusion, regardless of Macropoland’s current economic condition, it is fair to say that it is all part of the business cycle. The business cycle has three parts: peak, trough, and peak. The peak is the date that the recession starts. In Macropoland’s case, the peak would be at the beginning of 1973, its trough somewhere between 1973 and 1974, and then its peak again at 1974. In the second scenario, Macropoland is either at its trough, where it is about to head up again because of its low inflation rate, or it is at its expansion, on its way to heading to its next peak.
A balanced stance on fiscal policy was targeted by the Government in response to the global recession between short and long-term policies. These measures involved bonus payments to low and middle-income Australians to insta...
Permatasari, S (2011, 7 August) Australia’s Economy has Strength to meet challenges, Swan Says; Bloomberg, Retrieved from http://www.bloomberg.com/news/2011-08-07/australia-s-economy-has-strength-to-meet-challenges-swan-says.html
Gustman, A. L., Steinmeier, T. L., & Tabatabai, N. (2012). How Did The Recession Of
The health of a labour market can be judged by levels of unemployment and changes in wage growth. Both of these issues come into play when The Australian Financial Review reports that the Australian labour market has tightened over the past twelve months and comments on predictions for the coming year.
"Australia." Economy: Population, GDP, Inflation, Business, Trade, FDI, Corruption. N.p., n.d. Web. 2 Dec. 2013. .
downward spiral in 1990 .The bubble economy burst in 1991, economic growth stalled and factories going bankrupt.
Economy condition in Australia shows upward trends proven by the 3% increase of its economic growth (Figure 1) and decrease in the inflation (Appendix 1). Meanwhile,
The money supply increased which also lead to an increase in spending. And the effect was that from 2002 spring to 2006 spring, the GDP increased to 26 percent, thus as the GDP...
Australia has had one of the most outstanding economies of the world in recent years - competitive, open and vibrant. The nation’s high economic performance stems from effective economic management and ongoing structural reform. Australia has a competitive and dynamic private sector and a skilled, flexible workforce. It also has a comprehensive economic policy framework in place. The economy is globally competitive and remains an attractive destination for investment. Australia has a sound, stable and modern institutional structure that provides certainty to businesses. For long time, Australia is a stable democratic country with strong growth, low inflation and low interest rate.(Ning)
Over the past few years, the Philippines' economy has undergone a remarkable transformation. In the late 80's and early 90's the Philippines were stuck with poor political leadership, economic growth, and slow paced economic development. Today it is recognized globally that the Filipino economy has turned around to produce a positive growth. One of their biggest accomplishments has been the GNP growth rate rise from zero in the early nineties to between 5% and 6% today.
Figure 1 illustrates the relationship between real GDP which represents the economic grow and IR over 40 years in the UK. In the late 1980s the UK experiencing a huge stagnation period and from the figure the IR was hig...
...nt of the CPI, which ultimately led to a decay of inflation to 11.8%, an additional miss of the single digit target in 2002. There was also conversation rate immovability coupled with a decline in the prime rate which was presented during the NPP government in 2004 to exchange the bank rate. This replicated in a fall in interest rates which is a lift to savings and general productivity of the economy.
The first zones are the high rain fall zone and the coastal zone these zones are