Australia has fallen into recession for the first time in 29 years.
According to national accounts data published by the Australian Bureau of Statistics (ABS) on Wednesday GDP contracted by 7 percent in the June quarter – more than three times more than the previous biggest fall of 2 percent in 1974.
“This is, by a wide margin, the largest fall in quarterly GDP since records began in 1959,” said Michael Smedes, Head of National Accounts at the ABS.
It marks the second consecutive quarter of economic decline, meaning that Australia is in a recession for the first time since 1991.
“Today’s national accounts confirm the devastating impact on the Australian economy from COVID-19.
“Our record run of 28 consecutive years of economic growth has now officially come to an end.
“Behind these numbers are heartbreaking stories of hardship, being filled by everyday Australians as they go about their daily lives,” Treasurer Josh Frydenberg said on Wednesday.
The ABS found that due to increased number of recipients and additional support payments, social assistance benefits in cash rose to a record 41.6 percent.
Meanwhile, Australians’ spending on services fell 17.6 percent in the June quarter while hours worked fell a record 9.8 percent and the household saving to income ratio rose from 6 percent to 19.8 percent.
Household expenditure declined by 12.1 percent.
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