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The federal budget has failed to impress the majority of brokers according to the latest Mortgage Business weekly straw poll.
Just over half of the 338 respondents – 52 per cent said the federal budget was not good news for the domestic economy while 37 per cent of respondents were confident the budget would be good for the economy. Just 11 per cent were unsure.
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A key concern about the federal budget has been its multi-billion dollar deficit but ANZ chief economist Saul Eslake told Mortgage Business concerns about the deficit were unfounded.
“I have no concern at all regarding the deficit,” Mr Eslake said, emphasising that it was good news the government had taken action in the face of the recession.
Mr Eslake also expressed confidence in the Australian economy and its strong position in comparison to most of its international peers.
“Australia has obviously been affected by the global slowdown but not to the same extent as many of our advanced economy peers,” he commented.
“This is largely because we haven’t had the same internal problems with regards to our property market and financial system as some economies such as the USA.”
Mr Eslake said Australia was also fortunate to have trading partners in the developing nations of Asia, who were weathering the downturn reasonably well and said monetary and fiscal policies were working effectively and in a timely manner.
While Mr Eslake was confident the economy would return to positive growth he said there was no guarantee the economy would return to above average growth by 2011 – as forecast in the budget.
“In previous post-recession recoveries growth has sped up,” he said, but the economy faced a unique set of circumstances in this global slowdown he emphasised.
“It wouldn’t be unprecedented, it is possible, but it’s certainly not guaranteed.”
