Asia Markets: Australias government, banks face off over rates
By Sarah Turner MarketWatch
11/11/2010 11:45:11 PM
|Evening Market Wrap||Thu Nov 11 17:01 2010|
|Banks war continues on foreign soil|
|Julia Gillard and Wayne Swan have been working the diplomatic circuit in Seoul.|
But they have been less than diplomatic with the banks.
Phillip Coorey reports the PM has accused the big banks of threatening Australia's economic recovery by fleecing customers with large interest rate increases.
In a speech in Seoul yesterday to a forum of 120 global business leaders, including the chief executive of ANZ, Mike Smith, the Prime Minister said the latest increases by the Commonwealth Bank and ANZ were damaging consumer confidence and, therefore, economic recovery. With the leaders of the world's 20 foremost developed and developing nations in Seoul to discuss the global recovery, Ms Gillard told the forum that Australia's economy had weathered the global financial crisis better than most. Growth was a ''strong'' 3.3 per cent, more than 375,000 jobs had been created in the past year, and the budget was due to return to surplus in 2012-13, by which time other Group of 20 nations were hoping to halve their deficits. ''But this good economic news is being threatened by community concern and anger about mortgage interest rates,'' she said.
Tony Abbott has fired up too, writing today: Prime Minister Gillard is reportedly angry over the latest bank interest rate rise ... Wayne Swan has been angry with the banks on more than 30 occasions over the past three years but that hasn't stopped them from raising interest rates by more than the Reserve Bank. This almost never happened under John Howard and Peter Costello and is a sign that the current government isn't taken seriously as an economic manager.
Currency positioning: David Uren says Wayne Swan has signed up to a US attack on China's currency management, declaring it risks suffocating recovery in the major advanced economies.
Editorial diplomacy: The Treasurer has also penned an op-ed on
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