Crisis “still spreading” IMF

The effects of the global financial crisis are still spreading.

This is confirmed in the latest IMF global stability report, which was released overnight.

It says that more families and companies in both the developed and developing worlds are now feeling its effects,

The Treasurer, Wayne Swan, said the report makes “sobering” reading.

It comes just one day ahead of the IMF’s World Outlook report.

That is expected to show further downward revisions of global prospects.

Mr Swan said these are expected to include a projection that the world’s economy will shrink this year, for the first time in 60 years.

The latest IMF report says the world’s financial system remains under stress, despite many government efforts to repair it.

It urged governments throughout the world to quickly repair any troubled banks they may have.

That is not a problem in Australia.

Mr Swan said Australia’s four big banks are all rated among the world’s 11 strongest.

“However Australia is not immune from developments in international financial markets,” Mr Swan said.

“That is why the government has taken decisive steps to strengthen the resilience of Australia’s financial sector,”  the Treasurer added.

He said these had included guaranteeing the deposits and wholesale funding of Australia’s banks, building societies and credit unions.