There are warnings the optimism on Australian markets may be short-lived, while economists predict a cut to official interest rates.
After a horror day on the stock markets, Wall Street has bounced back overnight recovering more than half of its record losses.
A US Democratic Senate aid has also announced there will be a vote on the financial bailout package later in the week.
But local analysts are warning the package could easily be rejected again.
In response to the financial crisis, the Reserve Bank is tipped to reduce official interest rates by 0.5 per cent this week, but Treasurer Wayne Swan has told the ABC, he won't attempt to force commercial banks to pass on the full rate cut.
“I would encourage all of our banks to act as responsibly and as competitively as they possibly can,” he said.
“Some reports this morning, that the banks may not pass on any of any proposed cut from the RBA are simply incredible.
“I can’t believe that the banks would behave in that way.”
But, the Opposition says the banks should be pressured to follow the lead of the RBA.
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Australian investors are being warned there are tough economic times ahead, despite predictions of a rally on the sharemarket today.
Wall Street has recovered half of its losses overnight, after US President George W Bush urged Congress to pass the massive financial bailout package when it meets on Thursday.
Opposition Leader Malcolm Turnbull has told 2GB’s Alan Jones we're well placed to survive the crisis, but it's going to be tough.
“We are in stormy waters, we are going to get wet – we’ve got a strong economy, we won’t sink.
“But we’ve got to recognise it’s not going to be easy in the months and years ahead.”
There are also claims the Reserve Bank will have to cut official interest rates by half a percentage point next week, in reaction to the turmoil on US markets.