The Aussie economy and exchange traded fund (ETF) are looking up from down under. The International Monetary Fund (IMF) has given an upgrade and just a minor contraction is expected for this year.

Here are some reasons why things in Australia are looking up:

• The IMF has upgraded their economic outlook for Australia this year: it now predicts a small contraction, followed by a big rebound in 2010.
• Rachel Pannett and Enda Curran for The Wall Street Journal report that the upbeat views coincide with latest forecasts from the Organization for Economic Cooperation and Development (OECD), which also predicts a mild downturn this year. The revisions are in response to steps the government took to mitigate the downturn.
• Business sentiment was also positive for June for the first time since December 2007, and borrowing costs will stay historically low and unchanged. The sentiment index rose 6 points to 4, after holding below zero for the previous 17 months.
• The growing business sentiment is indication that the economy may dodge the global recession. And there is nothing dodgy about that.

• iShares MSCI Australia Index (EWA): up 23.8% year-to-date

For more stories about Australia, visit our Australia category.

Tags: Australia, EWA, Global ETFs