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Whether it’s inflation, property values, employment levels, new car sales or copper prices, there are as many recession ‘tipping points’ as there are commentators on the subject.
The economists’ jury is still out on the likelihood of Australia entering a full-blown recession, but the chatter is getting louder.
The traditional definition of a recession is two consecutive quarters of negative real GDP growth. But others, such as independent economist Saul Eslake, define it as a period in which unemployment rises by 1½ percentage points or more, in 12 months or less, and then until it starts coming down.
Currently, there are signs for and against an economic slump. In August 2022, the Roy Morgan Monthly Business Confidence indicator was 96.0 (up 1.1pts since July), the first monthly increase for four months since April 2022. This was the first rise in business confidence since the RBA began increasing interest rates in early May this year.
Roy Morgan Monthly Business Confidence -- Australia
Source: Roy Morgan Business Single Source, Dec 2010-Aug 2022. Average monthly sample over the last 12 months = 1,442.
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