Sources: RBA; Securitisation System  Conclusion In summary, the lagged effect of the cash flow channel of monetary policy is likely to be somewhat elongated currently due to the high proportion of fixed-rate loans and sizeable buffers held by many borrowers.
We projected GDP to decline by 0.4% in 2020 but for domestic activity to fall by around 7 per cent, and unemployment to rise to 5.3% from its pre-crisis level of 4.9%. Looking towards 2021, we see a modest recovery for overall domestic demand and GDP, of the order of 1.6% and 3.4% respectively.