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Wednesday, 22 April 2020

Houdini act

Blessed be the hoarders

There was an unprecedented +8.2 per cent spike in the preliminary retail turnover figures for March (charted by data king James Foster below), as Australians rushed to hoard toilet and tissue paper, rice, pasta, home office goods (Officeworks, IKEA), and a range of other supermarket produce and liquor retail. 

This led me to pose the following conundrum during an idle moment: could iron ore exports see Australia post a flat result for GDP in the first quarter (thus dodging the technical definition of a recession in the process)?

It was an interesting technical discussion to which the answer is a mathematically possible but highly likely 'no'.

In any case this is a moot point given that the national accounts for the second quarter are sure to be an abomination, with hundreds of thousands of Aussies not working this month. 

A beautiful set of numbers

In brighter news, the government has apparently pulled off a masterstroke in terms of containing the Australian spread of COVID-19, with an increase of just seven to confirmed cases today, from 12,599 tests over the past 24 hours. 

There were four further cases as part of the north-west Tasmania outbreak, but almost nothing else today. 

Many of the states and territories once again reported a nil increase in cases.

There were another 237 recoveries, and ICU cases fell yet again to 47, as the focus turns now shifts towards how and when Australia can ease its restrictions.

It's unlikely that Australia will pull off the Houdini act of avoiding a technical recession this time around, but the virus figures are so low that a decent rebound in Q3 is a possibility, even if the risk of a second wave of infections remains at large.