The economy is facing headwinds this year, which will be unfamiliar to many after an almost 30-year run of growth and a post-pandemic boom. Here we explain what you might expect in the months ahead, and what history has taught us about economic highs and lows.
What’s in store for the rest of the year?
The Australian economy is forecast to follow many developed countries through a transition period this year as it faces the threat of high inflation and cost of living pressures.
“We are expecting growth to be a lot slower this year, both globally and in Australia, and we have already started to see early signs of that,” says Justin Fabo, Senior Australian Economist at Macquarie Group.
But Australia is better placed than other advanced economies, and a recession isn't necessarily on the cards.
“The risks are heavily tilted towards a recession in the major advanced economies like the United States and Europe,” says Fabo.
“We don’t have such a pronounced downturn pencilled in for Australia, but the economy will slow down, and unemployment will rise.”