An expert panel of economists has shared its 12-month predictions for Australia. The good news includes a return to real wage growth. The bad news includes even higher home prices and a per-capita recession, writes Peter Martin.
KPMG Chief Economist Brendan Rynne assigned a 100 per cent probability to what he called a "shallow, extended recession", in which growth is first weighed down by a downturn in housing investment, followed by a slowdown in business investment.
The forecasts are in line with those of the Treasury and Reserve Bank, and suggest Australia is unlikely to surrender the big gains in employment made in the aftermath of the COVID lockdowns and return to the pre-COVID unemployment rate of 5 per cent. Most of the panel expects some growth in Sydney and Melbourne home prices in the year to June, with only four panel members predicting declines. The average forecast is for both Sydney and Melbourne prices to climb by 2 per cent.
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