Australia Experiences First Quarter Contraction in 9 Years Due to COVID Impact... 0.3% Decline from Previous Quarter

[Asia Economy Reporter Jeong Hyunjin] Bloomberg reported on the 3rd (local time) that the Australian economy recorded its first negative growth in nine years in the first quarter of this year due to the impact of the novel coronavirus infection (COVID-19).

According to the report, the Australian Bureau of Statistics (ABS) announced that the GDP growth rate for the first quarter (January to March) was -0.3% compared to the previous quarter. This is the first negative quarterly growth since 2011. The annual GDP growth rate decreased by 0.8 percentage points from 2.2% to 1.4%.

This negative growth was influenced by the impact of COVID-19 and the Australian bushfire crisis that lasted from the second half of last year to early this year. Household spending decreased by 1.1%, pulling down the overall GDP by 0.6 percentage points. Due to lockdown orders, consumption in service sectors such as travel, hotels, and restaurants significantly declined. On the other hand, government consumption increased by 1.8%, raising GDP by 0.3 percentage points.

Experts predict that the economic shock caused by COVID-19 will deepen in the second quarter of this year, leading to a larger drop in growth rate. Accordingly, foreign media expect that Australia's record of 'growth without recession' that has continued for 29 years since the 1990-1991 recession will be broken. Australian Treasurer Josh Frydenberg responded "Yes" to the question "Is the economy currently in a recession?" adding, "That is based on advice received by the Treasury."

Foreign media also reported that from this month, social distancing policies related to COVID-19 have been significantly eased in Australia, and economic growth is expected to rebound from the third quarter of this year.

This content was produced with the assistance of AI translation services.