Previously unpublished internal research from the Reserve Bank estimates that Australia's risk of recession over this year and next could be as high as 80 per cent.
This research also offers some insight as to why the Reserve Bank may have eased off on its monetary policy tightening, from 0.5 percentage point increases from June to September to a 0.25 of a percentage point rise in October.
"The proportion with inflation getting inside the band without a recession is notably lower, at around 55 per cent." "Some of the simulations with inflation returning to target involve significant increases in the unemployment rate," the September research noted.
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