Treasury boss Stephen Kennedy says there is “little doubt” the global economic impact of COVID-19 is significant as he predicts the coronavirus will detract 0.5 per cent off GDP growth in the March quarter. Delivering an update to the Senate on Thursday, Mr Kennedy stressed the hit was primarily thanks to a slowdown in the tourism and education sector and the exchange rate.
“We have undertaken a preliminary assessment of what the impact of COVID-19 might be in the March quarter, and at this stage, we expect the virus to detract at least a half of a percentage point from growth in the March quarter 2020,” he said.
“Beyond this preliminary estimate for the March quarter it is too early to tell, given the uncertainties, what the full impact of the COVID-19 coronavirus will be on the Australian economy.”
He also outlined it was clear the virus would “undoubtedly” impact the budget bottom line as confidence weaned and warned the growth figures for the “June quarter and beyond” would also be also affected.
Mr Kennedy also estimated the summer of bushfires would detract 0.2 of a percentage point across the December 2019 and March 2020 quarters.
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