Look out for the tsunami, says Costello
Email Printer friendly version Normal font Large font Jessica Irvine and Peter Hartcher
October 26, 2007
THE Treasurer, Peter Costello, has warned of a "huge tsunami" set to engulf global financial markets, with China as its epicentre, in his strongest bid yet for the Reserve Bank not to raise interest rates next month.
In his first newspaper interview of the campaign, Mr Costello predicted the US economy would weaken in the wake of its subprime mortgage meltdown, and said the breakneck pace of Chinese growth could not continue.
At some stage, likely to coincide with a move to a floating exchange rate, the Chinese economy would unleash even greater instability on global markets than the US had.
"That will be a wild ride when that happens," he said. "That will set off a huge tsunami that will go through world financial markets
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