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Citi Flags Sharp Slowdown Risk for Australia as Omicron Rages

  • Bank’s economists see consumers staying home amid record cases
  • They cite reduced activity even in absence of government curbs

Citigroup Inc. economists warned Australia’s growth could slow sharply, driven by record-breaking daily Covid-19 cases amid a shift in the government’s strategy to live with the virus.

Economists led by Josh Williamson now see the risk of a major hit to first-quarter growth that could cap the expansion at 1.3%, down from a base-case forecast of 2.3%, as fear surrounding the omicron variant damps activity even in the absence of more government restrictions.