Australia GDP contracted -7.0% qoq in Q2, worst than expectation of -6.0% qoq. That’s the largest quarterly decline on record since 1959. Combined with Q1’s -0.3% qoq decline, technical recession is confirmed for the country. Looking at some details, private demand detracted -7.9% from GDP, driving by -12.1% decline in household final consumption expenditure. Services spending dropped -17.6% too. Net trade contributed 1.0% to GDP. Public demand contributed 0.6%.
After the release, Treasurer Josh Frydenberg said “Today’s national accounts confirm the devastating impact on the Australian economy from COVID-19… Our record run of 28 consecutive years of economic growth has now officially come to an end. The cause? A once-in-a-century pandemic.”
Nevertheless, “Australia’s economic performance sits among the top of those developed nations as a result of our health and our economic plan to fight the virus,” he added. “Our priority has and will continue to be saving lives and ensuring that Australia’s healthcare system has the capacity to test, trace and treat coronavirus cases.”
