The Prime Minister of Australia, Kevin Rudd, took an optimistic stance when he spoke to a conference at Melbourne University, claiming that, despite the last 12 interest rate rises and the financial crisis sparked by the US housing and mortgage market, Australia's economy remained resilient and had minimal exposure to subprime loans.
Rudd claimed that Australia has a low exposure to the sub prime mortgage market.
"Today we face a global financial crisis that poses very significant challenges for the global economy as well as our own. The crisis began in the US housing and mortgage market, but has spread rapidly through broader credit markets, equity markets, and is now impacting the real economy. The whole world has been affected.
Slower world growth will inevitably affect Australia, although the economic strength of North Asia has a capacity to shield Australia from the sharper downturn amongst the G3 economies. But we can take nothing for granted. That is why the Government will continue to pursue a policy of responsible economic management aimed at placing the economy on a stable, long-term growth trajectory.
While a global financial crisis unfolds throughout the world, Rudd remains confident that Australia's economy can withstand future challenges for the long-term
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