In this regard, many people in the industry said that the world-famous mountain fires that have ravaged Australia in the past few months are completely disrupting Australia's economic and financial markets.
Economists sharply cut Australia's GDP forecast
The worst wildfire in Australian history has been burning for nearly four months. The market estimates that the fire has caused the Australian economy to lose more than 5 billion Australian dollars. Consumer confidence is weak, and the call for interest rate cuts is high. On Monday, Reuters economists revised their economic growth forecasts again.
Economists revised down the forecast of Australia's GDP in 20 19, from the original growth of 1.9% to the growth of 1.8%, far lower than the forecast of 2.7% at the beginning of last year.
This year, Australia's GDP growth forecast has been revised from the original growth of 2.5% to 2.3%, and the forecast for the annual growth rate of Australia's GDP economy in 20021year has also been lowered from the original market forecast of 2.75% to 2.5%.
Michael Blythe, chief economist of CBA, said that the impact of wildfires is more extensive than floods. Many areas experienced drought after the fire, which seriously damaged agricultural income, and the fire also affected Australia's domestic tourism.
Preliminary analysis report issued by Westpac Bank. 13 also pointed out that Australia is facing a loss of up to 5 billion Australian dollars (about 23.8 billion yuan) due to the continuous raging forest fires; In addition, Australia's "short-term" GDP growth rate is expected to decrease by 0.2 to 0.5 percentage points, with tourism and agriculture being the most seriously affected. Because the forest fire is still burning, its overall impact is difficult to determine, and its impact on Australia's overall economy is still in a state of "high uncertainty".
In fact, before the Australian fire, the annual GDP growth rate of Australia in September last year was 1.7%, which was not as good as the market expected. At the same time, in recent years, the salary growth of the Australian government has been lower than expected, and consumer confidence has fallen into a trough.
Ryan Felsman, a senior economist in the securities department of Commonwealth Bank of Australia, reported that the consumer confidence index fell to its lowest level in more than four years last week.
☆ Australian Prime Minister Morrison's support rate has fallen sharply.
It is worth mentioning that this mountain fire not only endangers Australia's GDP prospects this year, but also makes Australian Prime Minister Morrison face an unprecedented ruling crisis. A political poll released on Monday showed that the support of Australian Prime Minister Scott Morrison plummeted, and the bush fire crisis made Morrison's government exhausted. The fire has claimed 28 lives and burned 2000 houses.
When Newspoll was released on Monday, Australian officials also confirmed that the fire that had been burning for several months had reached 1. 1.2 million hectares (27.7 million acres), equivalent to nearly half of Britain.
Morrison was criticized for being slow to respond to this unprecedented crisis, and even took her family to Hawaii for a holiday during the fire. He admitted that he made some mistakes in the TV interview on Sunday.
On Monday, Frydenberg, Australia's Finance Minister, said when asked about the poll results that "we have clearly heard this message from the Australian people", when he announced a A $50 million wildlife conservation fund. "They want to see the federal government take a very direct response to these natural disasters and disasters," Frydenberg said.
According to Newspoll, Morrison's support rate plummeted from 45% to 39%, the lowest since he took over as leader of the Liberal Party in August, 20 18, and the support rate was also surpassed by Labor Party leader Anthony Albanese. The poll was conducted from Wednesday to Saturday last week and interviewed 1505 people.
☆ Is the Australian dollar afraid of disasters?
In the foreign exchange market, as the mountain fire continues to wreak havoc, the Australian dollar may "burn to ashes". Since the beginning of the year, the Australian dollar has been completely decoupled from the trend of Asia-Pacific risk assets such as RMB and A shares, and its performance in G 10 currency is only slightly better than the bottom pound.
The Reserve Bank of Australia has cut interest rates three times since last June. In June last year, the interest rate was lowered to a historical low of 0.75%, but it still failed to boost the market consumption power. Investors believe that cutting interest rates is a sign that the economy is in serious trouble.
Bryce believes that in the future, the Australian government will need to spend a lot of money on post-disaster reconstruction of wildfires. The Australian central bank may cut interest rates to a historical low of 0.5% near the middle of this year.
According to data compiled by Bloomberg, traders believe that the probability of the Reserve Bank of Australia cutting interest rates in February has exceeded 50%.
The key support of AUD/USD at present is the cut-in position of the 200-day moving average at 0.689 1. Losing this moving average will mean the failure of the reversal trend in the early and mid-term, as well as the reconstruction of the downward channel. Most observers and analysts are not optimistic about the long-term trend of the Australian dollar because there are still variables in the global trade and economic prospects in 2020.