THE NEWS WRAP: Australia overtakes ailing Spain to become 12th largest economy in the world

Australia has overtaken Spain to become the 12^th largest economy in the world, a result that Federal Treasurer Wayne Swan has hailed as a “remarkable achievement” given the country’s population size.

New International Monetary Fund figures show that Australia’s economy has overtaken South Korea, Mexico and now Spain in the past five years.

However, the IMF painted a gloomier picture in its overall report, stating that unemployment is set to remain “elevated” in many parts of the world.

Slipper quits as Speaker

Peter Slipper has bowed to pressure and resigned as parliamentary Speaker, to be replaced by Labor’s Anna Burke.

Slipper survived a narrow vote to continue in the chair but subsequently resigned after coming under intense pressure over a series of sexist SMS messages, which were made public as part of Federal Court proceedings against him.

Unemployment rate misleading: RBA

Australia’s official unemployment rate isn’t providing the full picture of our labour market, according to the Reserve Bank of Australia’s deputy governor.

In a speech in Hobart, Philip Lowe said that the labour market participation rate is currently around 0.5% lower than its average over the past five years. This rate is defined by the number of working age people who are either in work or looking for a job.

Overnight

The Dow Jones Industrial Average dropped by 110.20 points, or 0.8%, to 13,473.45. The Australian dollar fell to US102 cents.