In the 2019-20 Mid-Year Economic and Fiscal Outlook (MYEFO), the Australian government said the economy “continues to show resilience in the face of weak momentum in the global economy as well as domestic challenges such as the devastating effects of drought and bushfires.” However, there were some notable downward revisions in economic projections. In particular, through the two fiscal years from 2019 to 2021, household consumptions, and wages growth were deeply downgraded. These revisions affirm the case for more RBA easing.
For 2019-20 fiscal year, GDP is forecast to grow 2.25%, revised down from 2.75%. Household consumption growth was revised to 1.75%, down from 2.75%. Exports growth was revised to 2.25$, down from 4.00%. CPI was revised to 2.00%, down from 2.25%. Wage price index was revised down to 2.25%, from 2.75%. Unemployment rate was revised up to 5.25%, from 5.00%.
For 2020-21 fiscal year. GDP growth was kept unchanged at 2.75%. However, household consumption was revised down to 2.50%, from 3.00%. Exports, was revised up to 2.50%, from 1.50%. CPI was revised down to 2.25%, from 2.50%. Wage price index was also revised down to 2.50%, from 3.25%. Unemployment rate was revised up to 5.25%, from 5.00%.
