Importantly, it has been accompanied by a long period of stability in our financial system. These are significant achievements. This is especially so in light of the very large structural changes that have occurred in the global economy since the early 1990s, and the instability we have witnessed elsewhere.
A country doesn’t experience these types of outcomes without some good fortune and, importantly, without sensible policy and strong institutions. In Australia, we have had all three. Partly through sensible and pragmatic policy, the Australian economy has developed the flexibility to adjust to a changing world. An important element of this flexibility is our floating exchange rate.