Joe Hockey (North Sydney, Liberal Party, Treasurer) Share this | Hansard source

That was recognised in discussions with G20 finance ministers in Turkey last week. As the Governor of the PBOC, the central bank of China, identified in our discussions in Ankara, the Chinese stock market has had three significant corrections in the last quarter, which covers the same period as the Westpac survey: they had a significant correction at the end of June and in early July, they had a significant correction again in late July, and they had another correction in August. In all the Chinese stock market increased by 70 per cent in a six-month period in the last year, completely dislocated from the Chinese economy. Even though the market has had rapid gyrations, that has left the market 35 per cent higher than it was 12 months ago, which has created alarm in global equities markets. It is also the case that there is significant speculation about the United States Federal Reserve increasing interest rates, which has dislocated some of the capital flows around the world, particularly out of emerging economies. This all flows through to market volatility here in Australia. It also affects the currencies—you have seen the Australian dollar move significantly over the last three months—and, importantly, that flows through to households because every night on TV they are seeing this external news.

Mr Conroy interjecting—

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