Lockdowns for just under half of Australia's population will stretch into Q4

While we had encouraging news on Q2 economic growth today Q3 will see a contraction.

Second-quarter growth was a beat:

• Australia avoids a double-dip recession. Q2 GDP +0.7% q/q (0.5% expected).

I've just posted the latest from Australia's second-largest state of Victoria:

• Australia coronavirus - state of Victoria targets September 23 for 70% vaccination

So, September 23 is going to be pretty much the earliest for any easing back on restrictions, which will keep the screws tightened on economic growth. NSW is in an even worse position although they may keep pace with easings given the Premier there is not quite so keen on restrictions as Victoria's.

Nevertheless, the wind back of restrictions will not be quick and the bounce back in October will be limited. With some luck climbing vaccinations into November and December will see a better economic bounce.

The Reserve Bank of Australia meet next week, Tuesday September 7. A move to delay taper seems likely. Earlier previews:

• CBA expect a reversal of the taper decision
• RBA monetary policy meeting next week - sneak peek preview