Australia In ‘Income Recession’ While Russia Struggles To Ward Off Recession In 2015
Slow GDP growth of Australia in the last quarter has reportedly pushed the nation's economy into a technical "income recession." Russia, on the other hand, may have it worse with falling oil prices and economic sanctions from the U.S and European Union.
According to the Australian Bureau of Statistics, the GDP growth for September was at 0.3 percent in seasonally adjusted chain volume terms. Net export is one of the major contributors for the GDP growth, with a reported contribution of 0.8 percent points to the GDP.
According to a report by SydneyMorningHerald, Australia has already entered a "technical income recession." The Australian dollar reportedly went down after the announcement of the national accounts was made and is currently at a four and a half year low.
The weak national accounts data, however, has so far not had any major impact on the Australian stock markets. The investors continued to show confidence in the economy with the S&P/ASX 200 Index continuing to post gains even after the announcement.
Things may be more difficult for Russia as the country may have to prepare for a recession in 2015. According to a report by Foxnews, the Russian government has acknowledged that the country may be heading for a recession next year due to falling oil prices and economic sanctions imposed on the country by the U.S and European Union for its role in Ukraine.
A major portion of Russia's economy is dependent on oil and the commodity has seen a fall in prices in the recent months, leading to reduced revenues to the oil producing countries. At the recently concluded OPEC meeting, the oil producing countries have failed to come to an agreement to cut oil production to stabilise the global oil prices.
The Russian economic development ministry is forecasting a drop of 0.8 percent in the country's GDP in 2015. The figures are said to be early estimate, but the government is already making efforts to revive the economy and avoid a recession.
The Prime Minister of Russia, Dmitry Medvedev, has said in a press release that the government will support the auto industry by providing subsidies for the purchase of busses and equipment. This is one of the measures the government will be taking to stimulate demand in the market. The government may have to take strong steps in order to overcome a possible recession in 2015.