(13 April 2011 – Australia) National Australia Bank chief economist Alan Oster says the International Monetary Fund (IMF) figures show the global economy is so strong that the concern now is inflation.He said the data showed the IMF were concerned that inflation and growth may be too strong in Asia, and despite that they still had China’s growth at 9.5 percent, much higher than the global 4.5 percent outlook.
‘What it’s (the IMF report) saying is the big economies of, say, the US and some of the Europeans, particularly Germany, are doing a lot better than they previously thought,’ Mr Oster said.
‘The Asian economies are still extremely strong and while Japan was an awful tragedy from the human point of view, it’s not really going to cause a lot of disruption in terms of the Asia story.”
He said Australia is probably a bit too optimistic in its outlook.
‘Australia … have revised their growth numbers this year from 3.25 percent down to 3 percent,’ Mr Oster said.
‘When we look at Australia, what we see is probably a negative GDP in the March quarter because of the floods. They are revising down, but not as much as what they probably have to.
‘I should emphasise the floods and the cyclone effects are temporary hits to activity that will be reversed during the course of the rest of the year.’