Treasurer Josh Frydenberg has confirmed that Australia is in a recession.
GDP figures from the Bureau of Statistics show Australia’s economy shrank 0.3 per cent in the March quarter, amid bushfires and the early stages of the coronavirus pandemic.
A recession is generally defined as two consecutive quarters of GDP decline.
Mr Frydenberg says the June quarter will be “far more severe than we have seen today”.
This makes it certain that Australia will suffer its first recession in 29 years, as the full impact of coronavirus-related shutdowns occurred during the current June quarter.
The combined devastation of the bushfire season and the ongoing coronavirus pandemic are being cited for the economic downturn.
The last time Australia recorded two consecutive negative quarters for GDP was March and June 1991.
According to the ABS, even before the full effect of the coronavirus hit, Australia’s economy recorded its slowest annual growth in more than a decade.
“This was the slowest through-the-year growth since September 2009, when Australia was in the midst of the global financial crisis and captures just the beginning of the expected economic effects of COVID-19,” the bureau’s chief economist, Bruce Hockman, said.