Yesterday’s national GDP data (see here for commentary) showed that Australia is in recession; first quarter GDP fell 0.3% qq and, as is abundantly clear, the second quarter data will show a further significant decline (our projection is for a 8.7% qq fall). This national data, combined with the recent release by QLD Treasury of the Gross State Product data (see here) for Q4 2019, allows us to update our own models for Queensland and the Cairns region.
We are now expecting Queensland GSP (which will not be confirmed for another 3 months) to show a significant decline in Q1 of 1.4% qq with a further 6.8% qq fall in the second quarter.
In the broader Cairns region the new data, and our modeling, suggests that Gross Regional Product fell in the final quarter of 2019 (-0.2% qq) and again by 0.8% qq in the first quarter of 2020; meaning that the Cairns region was already in recession before the full impacts of the COVID-19 lock-down took full effect.
Within the Cairns Regional Council area we estimate quarterly GRP fell 0.3% in Q4 by another 0.6% and in Q1 is expected to be down 10.9% in Q2.