Swan upbeat on moderating inflation and ASX-SGX merger
Federal Treasurer Wayne Swan is upbeat that economic indicators were pointing to encouraging developments as he expressed joy that inflation figures were moderating while dynamics in the shares market remain exciting, with the prospect of a likely merger between the Australian Securities Exchange and the Singapore Exchange almost a creeping reality.
On the latter, Mr Swan refused to speculate on the merits and demerits of the planned takeover of ASX by the city-state's stock exchange management though he pointed out that the proposed merger should be based on maximising Australia's economic well-being.
He said that it would be prudent to refrain from second guessing the merger's outcome since a process is already underway to determine what is best for both markets, reiterating his earlier emphasis that "the decisions that I take under the act are decisions that maximise the economic prosperity of our nation."
The SGX tossed a more than $8 billion takeover bid for the Aussie stock exchange to possibly create the world's fifth largest equity market exchange, boasting a capital market that could reach trillions of dollars.
However, before the deal could push through, it has to hurdle government regulators' concerns and for some Australian politicians, Singapore needs to deal first with its controversial human rights record prior to getting the necessary nod of the Australian authorities.
Mr Swan said that in defending the country's national interest, which is being attached to the mega-deal, he is set to review the detailed assessment of foreign investment proposals officially provided by the Foreign Investment Review Board (FIRB).
He argued that so far, his role as a federal treasurer has pointed to the fact that upholding national interest is the best way to serve the country.
As for the latest inflation figures released on Wednesday, Mr Swan said that the numbers were the lowest underlying rate since 2005 but despite the apparent gains, economic challenges are still ahead that further motivates the federal government to sustain its infrastructure investment measures and reducing corporate taxes.
Mr Swan added that the ever-increasing value of the Australian dollar may be contributing to the moderating inflation rates and more attractive consumer prices but the export sector of the economy is finding it more difficult to entice more customers even if capital equipments for business operations became considerably cheaper.
Behind the numbers, Mr Swan reminded that many Australians are still undergoing economic struggles which were mostly brought about by higher utility bills as he noted the results clearly showed that more burdens were being laid on family budgets.