AUATRALIA ...may escape recession
ANZ (Australia New Zealand bank) boss says Aust. may escape recession, shows new optimism
ANZ Banking Group Ltd boss Mike Smith says Australia may escape a technical recession and he has new optimism about the country's ability to ride through the global financial crisis.
"Although I have said there will be a severe slowdown in Australia, I am less pessimistic than many, and I believe there is cause for optimism that the downturn in Australia may not be as deep and protracted as many now fear," Mr Smith told an American Chamber of Commerce (AmCham) lunch in Sydney.
Mr Smith also said he believed pessimism about China was "overdone."
Mr Smith said it was hard to understand the true depth of the crisis from Australia, and the prospects for the world economy in 2009 were bleak, with the world's most sophisticated economists likely to experience the first annual contraction in economic activity since the Second World War.
"2008 was an extraordinary year for the whole world, but in some ways Australia has been insulated from the full impact of what has been happening," he said.
He said growth in emerging economies was expected to slow more sharply than seemed likely two or three months ago, probably by about 3.5 per cent on average.
"While Australia is better positioned and has been remarkably resilient so far, it has not given us immunity - nor will it this year," Mr Smith said.