Fed: Gillard tips rates to go down, unemployment to rise

AAP General News (Australia)
04-01-2009
Fed: Gillard tips rates to go down, unemployment to rise

ADELAIDE, April 1 AAP - Australia still has scope for further interest rate cuts, acting
Prime Minister Julia Gillard says.

But unemployment in the country is expected to rise above seven per cent by the middle
of next year due to the impact of the global financial crisis, Ms Gillard says.

She says a period of negative economic growth in Australia is inevitable due to the
global crisis.

"Australia still has scope for further interest rate cuts and still has unmet demands
for new housing constructions," she told a business luncheon in Adelaide on Wednesday.

But she forecast that more people would become unemployed in the next year.

"Our most recent published forecast show unemployment rising to seven per cent in the
middle of 2010," Ms Gillard said.

"Updated forecasts will be published at the time of the budget.

"Since our latest forecast was published we have seen the global recession worsen and
dramatic downgrades in global growth.

"Those global forces impact on our economy and make a period of negative growth inevitable
in Australia.

"That has flow on consequences for employment and the numbers of Australians who will
confront the stress and heartbreak of being made redundant or not being able to find work."

AAP sl/rp/tnf

KEYWORD: ECONOMY GILLARD

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