What odds an Australian recession in 2019?

Yesterday in response to Gerard Minack’s latest I noted that my base case was not for recession in 2019 but steep slowing to 2% GDP growth or below in H2:

The principle reason for this is still high public spending, decent net exports and population growth of 1.6%. I remain much more bearish about 2020 as China keeps slowing adding further falls in the terms of trade and concerns about an end-of-cycle exogenous shock.

But, there is still a strong case for an Australian recession next year, as high as 30% or 40%. That case revolves around the notion that the credit crunch underway today has no effective end. Consider the schedule of major national events ahead:

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About the author

David Llewellyn-Smith is Chief Strategist at the MB Fund and MB Super. David is the founding publisher and editor of MacroBusiness and was the founding publisher and global economy editor of The Diplomat, the Asia Pacific’s leading geo-politics and economics portal. He is also a former gold trader and economic commentator at The Sydney Morning Herald, The Age, the ABC and Business Spectator. He is the co-author of The Great Crash of 2008 with Ross Garnaut and was the editor of the second Garnaut Climate Change Review.