The probability of recession in Australia occurring before the end of 2024 could be as high as 80 percent, according to modelling by the Reserve Bank of Australia (RBA).
Internal documents from September 2022 published on Thursday under Freedom of Information laws reveal the most likely period for recession has already passed.
In a more optimistic model, returning Australia’s inflation rate back to the inflation target of two to three percent would come with a 50 percent chance of avoiding recession—what the RBA calls the “narrow path.”
But as the second simulation has Australia’s inflation rate remaining above the inflation target around 30 to 40 percent of the time, the raw probability of recession falls to around one-third….