Australia’s first recession since 1990

03 / 06 / 2020
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Australia is in its worst downturn since the Great Depression, economists generally see growth returning in the third quarter.  Australia’s economy has fallen into recession, the country’s treasurer said on Wednesday, after data showed gross domestic product fell last quarter as entire business sectors were closed to fight the coronavirus. The $1.39 trillion economy contracted 0.3% in the three months ended March, the Australian Bureau of Statistics said, the first decline in nine years.

Those curbs hit retailers and upended Australia’s labour market with 600,000 people losing work and the unemployment rate spiking to 6.2% in April. The central bank expects unemployment to hit 10% by June and stay elevated for much of 2021. The government, meanwhile, unleashed a large fiscal stimulus plan, including a A$60 billion wage subsidy scheme.

While Australia is in its worst downturn since the Great Depression, economists generally see growth returning in the third quarter. Optimism about a second-half recovery as the economy reopened supported the Aussie dollar.

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