ANALYSIS: What happens next if Australia's economic pain turns into a recession?
AMP senior economist Diana Mousina puts the "recession probability in the next two years as high, around 40 per cent".
NAB is forecasting the unemployment rate to rise sharply to 4.7 per cent next year and 4.8 per cent in 2025.CBA economist Gareth Aird's number crunching provides a similar outlook. "We expect the unemployment rate to be 4.3 per cent [later this year] compared with the RBA's forecast of 3.8 per cent," he said.The sting of any recession is that you're more likely to lose your job and, if your position is made redundant, it's very difficult re-entering the workforce.
Several economists now say the Reserve Bank will be left with little choice but to slash interest rates, potentially as early as later this year, to avoid that kind of bleak economic picture. Impact Economics and Policy lead economist Angela Jackson says she expects the "first interest rate cut by the end of 2023".And the NAB's Alan Oster says he expects the Reserve Bank will start cutting interest rates in February next year.
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