However, our judgement was that the size of the starting point shock was significant, and the risks were skewed towards a further material deterioration in the economy, presenting a significant threat to our employment and inflation mandates. We published scenarios for the economy that involved unemployment reaching between 8 and 12 percent, and an extended period of inflation below 1 percent (figure 1).
Figure 1  Scenarios for the unemployment rate and inflation from May 2020 MPS Unemployment  Inflation  Source: Stats NZ, RBNZ estimates.