Australia cuts interest rates

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Australia's central bank cut interest rates to counter the economic damage from Corona virus. Live from London. This is the marketplace morning report from the BBC World Service. I'm Vivian newness. Good Morning the Reserve Bank of Australia has cut interest rates to a record low of zero point five percent. The bank's governor said the spread of carving nineteen having a significant effect on the country's economy and uncertainty about the outbreak is likely to affect domestic spending China. The epicenter of the outbreak is Australia's largest trading partner Jennifer McEwen from capital economics. She says the outbreak could hit the Australian economy into a recession. It's possible that any economy could and of course it depends as well on the number of cases within the economy itself. It's quite possible that Australia and like many other economies will see a significant rise and that domestic spending is hit more. Australia is also quite reliant. On the Chinese economy not only for tourism but also is mining factories quite dependent on demand from China which is slumping because of the earth. There is a g seven meeting scheduled for today. That's the Group of Seven nations. They're expected to release some kind of joint statement. Kind of unified action. Could we see that group of Seven nations committed to the g? Seven finance ministers and central banks are meetings data there are host. There could be some announcement of fiscal policy policy supports or perhaps even a combined announcement of interest rate cuts now. I think this is quite difficult. Because the g seven economies are in different positions for example the Bank of Japan and the European Central Bank ready have negative rights so they have limited scope to announce the interest rate cuts some other facing constraints on government spending. So I think probably is going to be a more general statement about being willing to intervene. When necessary and perhaps some pledge of liquidity support so offering lots of loans to the businesses that are most affected by the virus just to try and tie them over is quite important at the moment that we try to avoid any layoffs by these businesses. Because that's what could turn this from a temporary shock into something much more. Permanent people actually lose their jobs. Then you're looking at a different situation than than a temporary stoppage related. Either to supply chain distortions factory closures Jennifer McEwen of capital economics one of the sectors. That's main hit. Hardest by the spread of virus is the airline industry with flight cancellations across the globe the body which represents airline is now calling for changes to the Y. Takeoff and landing slots at airports are managed under existing rules airlines that don't use a slot for eighty percent of the available time over a season risk. Losing it head of the International Air Transport Association Lower Ramon explains is much like a restaurant reservation a new ensuring that you still have that table reservation for the period you booked for when you want to come back again. So this is about enabling airlines have said this slots when recovery phase comes and they've still got they've they already have been using for this season unplanned tease Nazis I OUGHTA is contacting aviation regulations worldwide to request the rules governing. The use of airport slots be suspended. Immediately macy's all about flexibility to make those changes quickly but will say certainty to do them in a fashion where they're not going to be penalized for making a to the services they have planned head of the International Air Transport Association Lower Mourn. Let's do the numbers and hopes of a coordinated g seven action plan on the corona virus outbreak have caused European stocks to rise markets in London France and Germany up by more than three percent although some Asian markets closed lower gold and oil have made gains. Paris is famous for its outdoor terraces. A place to sit down and enjoy across on over glass of wine but hating those spaces mission huge amounts of carbon dioxide. And that's prompting a rethink should hate it outdoor terraces be banned the BBC's he scofield reports from the French capital. There are some twelve and a half thousand heated terraces in Paris today. Places where even on a winter's day you can sit outside and enjoy a coffee or a cigarette without feeling the cold however it's also calculated that heating an average terrace over one. Winter uses the same energy as driving a car three times around the world and that for environmentalist like the Green Party mayor of the Second Round Small Jack. Pluto is an outrage. We hit outside in the winter. It's totally absurd. We have to stop because there is no gency. Full to clean mate are enjoyed by smokers and non-smokers alike but most people seem to accept the idea that they're days maybe numbered legalize some of it. Surely sexually it would be a pain if they took away the heat races. It's nice to smoke outside and stay warm but of course we also have to think about what it meant for the environment the Seville. I think they are going to be in contradiction with everything we are doing to fight climate. Change just judy. We hating the outside World War. One City in France then has now banned heated terraces and the coors is gaining momentum ahead of next month's town hall elections but the decision is not straightforward. Smokers are asking where else they can go for. A cigarette and cafe owners are very worried about the impact on them. Sitting outside snug in winter is a very pleasant thing to do but if fighting climate change means making adjustments to our way of life. This looks like one luxury that we may well soon have to forego in Paris on the BBC's Hueco field for marketplace and fast food fans in Wales have queued for five hours ahead of the opening of the country's first TACO bell the American restaurant chain now has stored in thirty seven UK towns and cities in London. I'm Vivian Nunez with the marketplace morning report from the BBC World Service.

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