This news should cause further drop monday The government's cabinet budget committee will meet on Sunday to take any action deemed necessary from key meetings of the International Monetary Fund and Group of 20 finance ministers currently under way in Washington.
Foreign Minister Stephen Smith said there was a growing realisation that the international financial crisis was worse than originally thought.
He would not confirm reports that the government would follow other nations and lift the proposed savings guarantee from $20,000 to $100,000.
Mr Smith said the important thing was to bring stability to the international financial system to ensure there was no drastic credit crunch.
"Quite correctly, quite responsibly, our budget cabinet committee met yesterday. They will have a further meeting today. They will get further advice from the treasurer as a result of his IMF and G20 meetings," he told the Ten Network.
"We will do what is required to keep our system safe and secure and what is required to assist internationally."
Mr Smith said the G20 summit had to produce results.
"I spoke to the treasurer this morning. He had just come out of the final of the IMF meetings. He has got the G20 meeting later this afternoon.
"He made the point which I picked up in the Philippines last week which is a growing realisation that this crisis is much worse that people originally expected," he said.
"In that context of course Australia is better placed that most to take advantage of it."
Mr Smith said prudential and regulatory arrangements had been sound for many years.
He said the old adage with the Australian economy used to be that if the US sneezed, Australia got a cold.
"We are now much more buttressed by our trade to China, our expanding trade to India and also our trade with the ASEAN economies combined," he said.
Mr Smith said the IMF had predicted lower growth in Asia but that would continue to be positive economic growth.
"So we are better placed than most for a whole range of reasons," he said.
"But this is a very, very serious and grave international economic crisis and the response has to be an international community response. It has to be a global response."
Mr Swan said all advice at the moment was that Australia's economy would continue to grow.
"If you were to be in any country in the world at the moment in these circumstances you would want to be in Australia but we are not immune and it certainly will have a further impact on Australian growth," he said.
Mr Swan said the government forecast a slight increase in unemployment in the last budget.
"I would think that would be adjusted up when we see the full consequences of what's occurred - but too early to say by how much at this stage," he said.
Mr Swan said the one bright spot for Australia was that China's growth would remain relatively strong, although slower.
He said events of the last few weeks had been fundamentally damaging to confidence, with its flow-on to consumers and business confidence and impacts now spreading to emerging economies.
Mr Swan said the Reserve Bank had already applied a significant monetary policy stimulus through its one per cent rate cut last week.
"There is significant room to move there," he said.
"But we also do have the capacity should we deem it necessary to provide some stimulus to the economy."
Mr Swan said the government was looking to broaden the deposit guarantee scheme from the existing proposed $20,000 limit.
He said many other governments had taken such steps.
"I have had a look at those initiatives and I am providing feedback to the government on that. We expect to finalise those deliberations in the near future," he said.
"I don't expect we will need to put those into effect at all."
Mr Swan rejected one suggestion, that the government buy up some shares in banks to restore confidence.
He said banks were well capitalised and profitable.
"I don't think that particular suggestion will necessarily be one we will be following through on. But in these times we have every suggestion on the table because these are extraordinary times."
