Greece is one of several nations that will need to cut spending and boost taxes, slowing global growth even as low interest rates raise the risk of inflation, Australian central bank board member Warwick McKibbin said.
The fiscal outlook is what I call the slow motion train wreck — the first carriage to break is going to be the Greek economy, but we have a series of economies facing very serious fiscal adjustment, McKibbin, a professor at Australian National University whose board term ends July 30, said in a speech in Melbourne. He said his comments reflected his personal views, not the central bank’s.
Greece’s capital has been paralysed for the past two days by a general strike and protests by more than 20,000 people in a standoff focused on Parliament as lawmakers deliberate on Prime Minister George Papandreou’s $110 billion austerity plan.
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