Third, the slowdown in China’s economy has come to an end. The medium-term outlook for China is for a less hectic pace of growth than we saw on average over the past decade, and with more attention paid to the various risks – financial and environmental included – associated with that growth.
Having said that, the greater absolute size of the Chinese economy now means that even less hectic growth is still of global significance and of importance to Australia. Conditions have improved in international financial markets as the perceived probability of very bad events occurring has declined and as major central banks have maintained highly accommodative policies.