Flash floods hit Brisbane

AUSTRALIA: Residents of low-lying parts of Australia’s third largest city, Brisbane, sandbagged their homes against rising waters on Monday as torrential rain exacerbated record floods that have paralysed the coal industry in the northeast and now threaten tourism.

Prime Minister Julia Gillard insisted the cost of the floods would not delay a return to budget surplus in 2012-13, but J.P. Morgan predicted the disaster would crimp growth this year and could delay another increase in interest rates.

Weather officials issued a severe weather alert, warning of flash flooding and worsening river floods in Queensland state’s heavily populated southeast and the centre of the country’s lucrative Gold Coast tourist strip. “People need to think about how to get out and if you don’t need to travel, stay off the roads,” said Police Chief Superintendent Alistair Dawson.

The worst floods in 50 years, affecting an area the size of France and Germany combined, began last month and have severely cut Queensland’s $20 billion coking coal export industry, starving Asian steel mills of coal and pushing up world prices.

The floods have caused an estimated A$6 billion ($6 billion)in damage and economists say they will cut Australia’s economic growth in 2011 and heighten inflation as food prices rise and reconstruction gets under way in the nation’s second largest state.

Sydney, Monday, Reuters