Australian economy on track for recovery from COVID-19

Australia’s economy is on track for a gradual recovery from COVID-19, but faces the threat of a second wave of infections, according to the central bank on Tuesday.

At a meeting held earlier this month, Reserve Bank of Australia (RBA) officials pointed to the chance of a second wave of infections as a potential global stumbling block, reports Xinhua news agency.

“Should widespread contagion resume, with a return of lockdowns, confidence would suffer and cash flow would be strained,” it said on Tuesday.

RBA officials were broadly optimistic about the country’s success in containing the virus so far, leading to an earlier opening up of businesses than initially expected, and the possibility that a downturn would be shallower than expected.

Federal government stimulus measures were credited as instrumental in protecting the economy from collapse, with some households actually better off in terms of income under the pandemic.

“Households that were already receiving welfare payments had additional payments, and the JobKeeper program and increased JobSeeker payments had supported incomes for others.

“In some instances, households had received more income than usual,” the RBA said.

However figures show that along with a contraction in spending in late March and April, many Australians had lost their jobs or seen a drop in the number of hours worked, which fell by 9 per cent overall in April.

RBA officials said that while this figure was less than it could have been, it was still substantial and may have an effect on spending during the second half of the year.

Australia has so far reported 7,333 COVID-19 cases, with 102 deaths.