live rates in pandemic
The COVID-19 pandemic represents the largest
shock to the global economy in many decades.
Labour markets have been severely disrupted.
While infection rates have declined in some
countries, they have escalated in many others,
including the United States and some large
emerging market economies. Renewed
outbreaks are also occurring in some other
countries, including Japan and parts of Australia.
The ongoing spread of the virus, and the
responses to contain it, will combine to slow the
recovery.
The Australian economy has experienced a
severe contraction and, like many other
economies, is now in the early stages of
recovery. The contraction over the first half of
2020 was smaller than anticipated three months
ago, though it was still very large.
It was also not
quite as large as in some other economies,
where lockdown measures were more binding
and were imposed for longer.
aud
to inr However, the pace
of recovery is expected to be slower than
previously forecast. Generalised uncertainty and
deficiency in demand have turned out to be
more of a drag on growth than previously
thought. The measures taken to address the
current outbreak in Victoria will further delay the
recovery. The most recently announced
containment measures are expected to subtract
at least 2 percentage points from national
growth in the September quarter, relative to the
counterfactual where the renewed outbreak had
not occurred.
gbp to inr In light of the extreme uncertainty about the
course of the pandemic and its economic
effects, the outlook is again considered in the
form of three scenarios. In the baseline scenario,
the Australian economy is expected to contract
by about 6 per cent over 2020, before growing
by around 5 per cent over 2021 and 4 per cent
over 2022. This would still leave the level of
output below where it would have been had the
pandemic not occurred. Under the baseline
scenario, the unemployment rate is expected to
peak at around 10 per cent by the end of this
year.
AllhubssA stronger economic recovery is possible if faster
progress in controlling the virus is achieved in
the near term. In this scenario, a faster
unwinding of activity restrictions and greater
confidence lead to a faster recovery in
consumption, investment and employment. The
unemployment rate would peak at a lower level
and decline faster than in the baseline scenario.
However, a plausible downside scenario is where
the world experiences a widespread resurgence
in infections in the near term, and Australia itself
faces further outbreaks and lockdowns in certain
areas.
euro to inr aud to inr Activity restrictions would weigh on
household consumption and business
investment decisions, despite continued policy
stimulus and income support measures.
Domestic activity would take much longer to
recover in this scenario, resulting in the
unemployment rate remaining close to its peak
throughout 2021.
pound to dollar
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