Finance Minister Mathias Cormann has warned a second wave of coronavirus could cost the Australian economy $80 billion over the next two years.
His calculation came as global share markets erupted into a sea of selling on fears of a pandemic resurgence, killing off optimism for a quick recovery.
The Morrison government is concerned last week’s anti-racism rallies, and more marches slated for this weekend, will spread the virus.
Senator Cormann said protesters were putting lives and livelihoods at risk.
“If we had a second wave of infections it would cost our economy about $80 billion over the next two years,” he told Sky News.
“We are in the middle of a health emergency, this is not over, and people who choose to attend those rallies are putting the lives and jobs of their fellow Australians at risk.”
The Australian share market tumbled around three per cent in early trading on Friday after the Dow Jones index on Wall Street slumped over six per cent overnight, posting its wost day since mid-March.
The local share market also fell three per cent on Thursday.
Commonwealth Securities chief economist Craig James said the path to health and economic recovery won’t be smooth.
“That means sharemarkets … will experience bouts of irrational optimism as well as irrational pessimism,” Mr James said.
He said the sell-off in Australia came despite recent positive news on virus cases and on the economy.
“But investors also need to acknowledge that the news has been less positive overseas, influencing broader global sharemarket sentiment.”
Data released this week showed consumer confidence had returned to its pre-pandemic levels, while business sentiment was also improving.
Next week will see the the crucial labour force figures for May, after April saw the biggest one-month fall in employment on record.