Australia’s economy could contract by 6.3 per cent this year if there is a second wave of coronavirus infections, according to the Organisation for Economic Cooperation and Development’s [OECD} latest economic outlook.
Key points:
- The OECD’s latest economic outlook makes predictions for growth and jobs based on two scenarios
- If a second outbreak of coronavirus occurs, Australia’s growth will fall by 6.3 per cent this year, and global growth will fall by 7.6 per cent
- The report calls for further stimulus including extending JobKeeper, but some economists question whether there’s been too much stimulus already
The report urges the Morrison Government to introduce further policy measures to support households and businesses, including extending income support payments, such as the $70 billion JobKeeper wage subsidy, and building social housing.
Despite Australia hitting its first recession in 29 years, the report said Australia’s economy has been relatively spared, so far, from the COVID-19 outbreak.
Macroeconomic policy support including JobKeeper had limited the economic damage, it said.
While shutdowns and social distancing restrictions are being eased, the report warned that a possible secon