2020.12.0204:52:00UTC+00RBA Chief Says Australia's Recovery To Be Uneven, Bumpy

Australia's economic recovery will be uneven and bumpy, Reserve Bank of Australia Governor Philip Lowe said Wednesday.

The economic growth is set to be solidly positive in the third and fourth quarters, Lowe told a parliamentary committee. The central bank expects the economy to grow 5 percent next year and then 4 percent over 2022.

And even with the overall economy now growing solidly, it will not be until the end of 2021 that GDP reach the pre-pandemic level of output, Lowe said.

"These figures, though, cannot hide the reality that the recovery will be uneven and bumpy and that it will be drawn out," Lowe added. Some parts of the economy are doing quite well, but others are in considerable difficulty.

The unemployment rate is expected to be still above 6 percent in two years' time, he noted. Due to higher unemployment, wage and price pressures are likely to remain subdued. And underlying inflation is seen at just 1 percent next year and 1.5 percent in 2022, said Lowe.

Official data released earlier in the day showed that the Australian economy exited recession in the third quarter. GDP grew 3.3 percent sequentially after falling 7 percent in the second quarter.