MNI BRIEF: RBA's Lowe Sees 2% Fall In Q3 GDP

Reserve Bank of Australia Governor Philip Lowe says he is expecting the Australian economy to contract by "at least 2%" in the third quarter, but rebound back to its "pre-Delta track" by the second half of 2022.

In a speech on Tuesday, Lowe said the RBA "rough rule of thumb" was that household consumption is around 15% lower during a lockdown than would otherwise be the case.

Lowe said that prior to the Delta outbreak in early July the RBA had been "contemplating a further upward revision to our economic forecasts", see: MNI STATE OF PLAY: Lockdowns Force RBA To Extend QE.

The outbreak and the current lockdowns were a "major setback" but were likely to be only temporary, and the recovery had only been de-railed and not delayed.