Companies have suffered their slowest Christmas season ever due to the Omicron outbreak, with data showing business-to-business turnover hitting its lowest levels on record in the critical month of December.
“When COVID-19 hit, business-to-business trade really fell off a cliff,” Mr O’Donnell said. “The figures we’re reporting for the December month are the worst we’ve got on record.” of COVID-19 as households imposed their own restrictions to avoid the virus and pushed major cities into a “shadow lockdown”., meaning the full effect of the latest outbreak on business activity is still unclear.However, some signs are giving economists confidence as they project into the next few months. One is the high level of savings on business and household balance sheets due to record government stimulus during the pandemic.
AMP Capital chief economist Shane Oliver has now revised down his expected March quarter GDP growth to 0.6 per cent from 1.6 per cent due to Omicron, despite remaining confident of a strong post-Omicron rebound. Overall, he expects the economy to grow by about 4 per cent over the year, but his outlook is not all positive.
November was a strong month for retail sales as the Delta outbreak waned, which Mr Oliver said was a sign of pent-up demand and extra savings that may also support spending as Omicron subsides.