A recession is defined as two consecutive quarters of contraction. Australia enters first recession in 29 years after blow from bushfires and coronavirus and its economy shrank 0.3% in the previous three months.

b)  The change of each of the four major components of GDP in the first quarter 2020 were:

• The Australian economy contracted by 0.3% in seasonally adjusted chain volume terms in the March quarter 2020
• Through the year GDP was up 1.4%
• The terms of trade rose 2.9%
• Household saving ratio increased to 5.5% from 3.5%.

The Australian economy was impacted by a number of significant events this quarter, starting with bushfires and other natural disasters, followed by the outbreak of COVID-19 and the subsequent imposition of restrictions. The government responded with the introduction of economic stimulus and support packages.

We've seen that the private demand detracted 0.8 percentage points from GDP, driven primarily by a 1.1 per cent fall in household final consumption expenditure. Spending on services fell significantly, particularly where restrictions impacted most severely, such as air transport services, hotels, cafes and restaurants, recreation and culture.

Further, Net Trade contributed 0.5 percentage points to GDP. Imports of goods fell 3.9 per cent, with falls in consumption and capital goods reflecting weak domestic demand. Imports of services fell 13.6 per cent, with travel services falling sharply in response to the global outbreak of COVID-19 and associated travel bans. Exports of services declined 12.8 per cent, with restrictions on overseas arrivals reducing education related travel and tourism in Australia.

The household saving to income ratio rose to 5.5 per cent, reflecting a rise in gross disposable income and falls in consumption. Gross disposable income was driven by a 6.2 per cent increase in social assistance benefits due to both an increase in the number of recipients and the introduction of new government support packages in response to COVID-19 and bushfires.

c) Australian spending habits have changed markedly in the last few months, households believing their financial situation to be vulnerable or worse because of the pandemic, they are likely to struggle to meet all their financial commitments unless they either reduce spending, draw down on savings or access credit. But while Australian consumer spending remains slow, we’re seeing signs of recovery across most categories and grocery spending.The temptation to focus purely on immediate needs will be strong but seeking good advice about how to prepare and invest for the future is equally as important.

d) The Chain volume GDP and related measures from June 19 to June 20 is -6.3%

e) The Australian economy shrank 0.3% on quarter in the first three months of 2020, after a 0.5% growth in the prior period and in line with market consensus. It was the first contraction since Q1 2011, as the economy was hit by bushfires, drought and the coronavirus pandemic. The Australian economy advanced a seasonally adjusted 0.4 percent in the September quarter of 2019, slowing from an upwardly revised 0.6 percent growth in the previous period and missing market expectations of a 0.5 percent expansion. Government spending eased and household co at its weakest pace since the global financial crisis. Through the year to the third quarter, the economy grew 1.7 percent, following an upwardly revised 1.6 percent expansion in the June quarter.

Seeing all ups and down I would prefer to be incumbent Government running for re-election this time last year or now.