Economics

The NAB says we had better prepare ourselves for what its chief economist says will be “a recession of unprecedented speed and magnitude”.

Well, that’s not really new news is it, that ratings agency S&P Global is putting Australia’s triple-A credit rating on negative outlook, saying there had been a “substantial deterioration” in the country’s finances and which is now facing the risk of a deep recession.

More evidence of the slowdown gathering strength across the economy with the Australian Bureau of Statistics revealing that 66% of Australian businesses have felt some impact from the COVID-19 pandemic and its fallout on demand.

Now for the slowdown which could be the worst America has had outside the Great Depression as more than 6 million made their first jobless benefit claims last week – a record number in fact that followed an earlier record the week before.

China’s second survey of manufacturing activity last month rose back into positive territory, as did the official survey on Tuesday but the make up of the recovery wasn’t convincing and the weaknesses of these types of surveys were again exposed.

China’s economy stabilised in March, recovering after taking an enormous hit due to attempts to stop the spread of the coronavirus during February.

The Morrison’s governments’ third COVID-19 support package, is the biggest so far with over $130 billion on offer to support the wages of up to six million Australian’s through the current crisis.

The bottom line is that while we may see the biggest hit to global and Australian GDP since the 1930s thanks to the shutdowns, there are big differences compared to the Depression suggesting that a long drawn out global downturn is not inevitable.

More than 3 million people filed a claim for unemployment benefits last week in the US as the COVID-19 pandemic closed businesses, cities and entire American states.

At 3.30 am Sydney time on this Friday, we will get confirmation that the world’s biggest economy had been brought to a dramatic and brutal halt by the coronavirus pandemic. That’s when the initial jobless claims for last week will be reported by the US Labor Department.

The New Zealand government of Jacinda Arden has revealed a massive coronavirus assistance package that aims to support businesses and their employees through the looming downturn.

Retailers and small to medium businesses, apprentices and people on welfare benefits are the initial winners from the Morrison government’s coronavirus stimulus package.

Here’s a couple of views of the December quarter GDP rise of 0.5% quarter on quarter and 2.2% through the year (which was helped by a 0.2% revision upwards to 0.6% growth in the three months to September).

The COVID-19 outbreak has put the brakes on Chinese growth in the short-term. Three key data points bear watching for signs of a rebound.

China is hovering on the edge of a major crisis – the COVID-19 crisis has strangled manufacturing and services, left wide areas of the country silent and now it is hitting some of the country’s heavily indebted financial and industrial groups.

Watch markets in Asia and Australia slide today when trading resumes in Asia – the plunge in manufacturing activity in China in February was starling, much worse than any forecasts and will trigger a new round of instability, especially with COVID-19 cases outside China growing faster than inside that country.