Australia’s financial system has suffered its sharpest quarterly drop for the reason that Nice Despair due to the pandemic, with knowledge launched on Wednesday confirming the nation is in its first recession in 28 years.
The newest nationwide accounts confirmed the financial system shrank 7 % within the June, the largest contraction since information started in 1959.
Its nearest rival was a 2 % fall in June 1974. Economists estimate a sharper fall of 9.5 % in 1930, when Australian grew to become one of many world’s hardest-hit international locations by the Nice Despair.
Mixed with a smaller 0.three % drop within the March quarter, the definition of a technical recession — two consecutive quarters of contraction — has been fulfilled.
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“As we speak’s nationwide accounts verify the devastating affect on the Australian financial system from COVID-19,” Treasurer Josh Frydenberg mentioned.
“Our document run of 28 consecutive years of financial development has now formally come to an finish,” he added.
Prime Minister Scott Morrison instructed Parliament: “It is a devastating day for Australia.”
Group for Financial Cooperation and Growth figures present the common contraction amongst OECD international locations within the June quarter was 9.eight %, together with a 20 % droop within the Britain, a 14 % downturn in France and a 9.1 % drop in america.
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First Printed on Sep 2, 2020 11:27 am