Fed: Economy not overheating: Costello

AAP General News (Australia)
08-11-2000
Fed: Economy not overheating: Costello

CANBERRA, Aug 11 AAP - Treasurer Peter Costello has rejected fears the economy is overheating
despite a big rise in employment last month.

Employment grew 75,000 in July, prompting economists to warn a further interest rate
rise is now likely.

The official figures also showed the jobless rate fell to a decade-low of 6.3 per cent in July.

"I don't think that you could say there are signs of overheating in the Australian
economy," Mr Costello told ABC radio yesterday.

"We actually think unemployment's going to fall further than this."

He said if the economy continued to grow at current levels, with ongoing reforms, the
jobless rate could be approaching six per cent within a year.

"If you continue the economy growing at four per cent, if you continued with structural
reforms, the benefits of the new taxation system, you'd be knocking up against that six
per cent level," he said.

Prime Minister John Howard said he was delighted with the employment figures, calling
them magnificent.

"We have now created 809,000 new jobs since coming to office," he said.

"It's an astonishingly good figure, 75,000 new jobs for a month."

The result means the government has effectively reached its Budget unemployment target
11 months early.

AAP dep/gmw/de

KEYWORD: JOBS DAYLEAD

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