Shares soar and unemployment forecast improves — BUT…
Australia’s share market soared yesterday, but experts have warned of a slow and steady climb out of recession.
The market soared past 6000 points as investors pounced on central bank liquidity and optimism over easing coronavirus restrictions and improving economic data.
NAB’s chief economist, Alan Oster, said “we now look like we’re moving into something a little bit better”.
Mr Oster also told 3AW Breakfast that NAB would today release a forecast an improved peak unemployment rate of 8.5 per cent — “we previously thought about 10 per cent”.
But he was quick to temper enthusiasm.
“Can I just reinforce that the sort of the numbers we produced in our business survey, confidence is around the bottom of where it got to in 1990 and our business conditions, which is our output measure, is around the same as the bottom of the GFC,” he told Ross and John.
“So we’ve had one massive hit, but it does look like the easing of the health problems and therefore the easing up a bit of the economy means we’re probably past the worst.
“But when we get the June quarter GDP numbers, we’re going go to be down something like 8 per cent, so it’s going to still look really nasty, but you won’t see those figures until September.”
But it does predict Australia will be out of recession by the end of this year.
Click PLAY to hear Ross and John get the full explainer and analysis of the market