wiss police officer take position during the World Economic Forum (WEF) annual meeting in Davos, on January 20, 2016. A string of jihadist attacks and rising risks to the global economy overshadow the opening of the annual gathering of the world’s rich and powerful in a snow-blanketed Swiss ski resort. Even as heads of state, billionaires and Hollywood megastar Leonardo DiCaprio were arriving, the International Monetary Fund (IMF) sounded the alarm on January 19, 2016 about perils in the major emerging market economies and lowered its outlook for global economic growth this year. / AFP / FABRICE COFFRINI
The International Monetary Fund (IMF) on Wednesday warned Australia about its high level of household debt.
In the October Global Financial Stability Report, the IMF said “higher growth in household debt is associated with a greater probability of a banking crisis.”
Throughout most advanced countries, a financial crisis could lead to lower growth,’’ the report said.
With interest rates already at a record low of 1.5 per cent, any increase could add to the growing debt problem.
That’s why on Tuesday, Reserve Bank of Australia governor Dr. Philip Lowe cited “growth in housing debt’’ as one of the major reasons for keeping the cash rate on hold.
NAN
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