News

A stronger than expected economic recovery is on the cards for Australia if the nation’s successful containment of COVID-19 allows businesses to commence reopening believes The Reserve Bank of Australia Governor Phillip Lowe.

The RBA’s ideal scenario is for economic growth to fall 10% over the first half of 2020 and hover around 6% for the balance of the year with a peak unemployment rate of 10% in the first half dropping down to 7% by the year end.

The forecast could be more dire if the restrictive measures are left in place longer.

“A stronger economic recovery is possible if there is a further substantial progress in containing the coronavirus in the near term and there is a faster return to normal economic activity.” Said Dr Lowe.

This is a brief summary of the article ‘Stronger recovery on cards: RBA’ by Matthew Cranston | The Australian Financial Review – AFR | Wednesday 6th May 2020.