SYDNEY - Australia's worsening Covid-19 outbreak has brought a sudden end to a year of spectacular growth that marked one of the fastest economic recoveries in the world.

Official figures released on Wednesday (Sept 1) revealed that the nation's gross domestic product grew by a record 9.6 per cent in the year to June - a boom that has left the economy wealthier and with lower unemployment than before the pandemic.

But Treasurer Josh Frydenberg was far from exultant as he discussed the latest data. Instead, he admitted that these figures were "little comfort" to the millions of Australians who are now struggling in a prolonged lockdown.

The two most populous states, New South Wales and Victoria, are in lockdown, as is capital city Canberra.

As Australia prepares for its next election, due to be held before May next year, the federal government was relieved to learn that the economy had increased by a slim 0.7 per cent in the three months to June.

This growth meant that Australia is not currently in recession, which is defined as two consecutive quarters of contraction. The three months to September are expected to involve a significant contraction due to the current lockdowns in Sydney and Melbourne.

Prime Minister Scott Morrison will be keen to avoid talk of a recession in the lead-up to the next election. His approval ratings have been steadily dipping amid the lockdowns and concerns about his handling of the vaccination roll-out.

A Newspoll survey in The Australian this week found that 49 per cent of people were satisfied with Mr Morrison's performance, down from 59 per cent in April, with 47 per cent dissatisfied and the remainder uncommitted.

The survey also showed that the ruling coalition trailed the Labor opposition by 46 per cent to 54 per cent.

Despite the latest economic figures, several analysts said Australia is, in fact, in a recession. Calling the technical definition arbitrary, they said the health of the economy should be judged by measures such as levels of job creation or overall business conditions.

"Make no mistake, Australia today is in a recession," economics commentator Jessica Irvine wrote in The Sydney Morning Herald.

"Look around. More than half our citizens are confined to their homes. Jobs have vaporised. Businesses are shutting. If you've ever wondered what it would be like to live in a recession, well, this is it."

Australia's largest city, Sydney, went into lockdown in late June following a surging outbreak of the Delta strain. Melbourne followed three weeks later.

These two cities account for about 40 per cent of the nation's 25.7 million residents, but neither is likely to emerge from the pandemic restrictions before November because of Australia's low vaccination rates.

Currently, 36 per cent of Australians aged 16 and over are fully vaccinated. Lockdowns will not be lifted until vaccination coverage reaches 80 per cent.

The initial lockdown last year caused Australia to enter a recession, which ended a world-beating 28 years of consecutive growth. But Australia rebounded quickly as the government embarked on a massive spending spree and as people emerged from the lockdowns and began a joyful bout of consumer spending.

But there are concerns that Australia may not recover as quickly when the current Covid-19 crisis ends. While the government is supporting businesses and workers affected by the current lockdowns, these handouts have been less generous than last year's. And there are also concerns that Australians will not emerge as confident because they will still face the uncertainty surrounding the seemingly indomitable Delta variant.

Economics commentator John Kehoe said Australia is well-positioned to thrive after the lockdowns, but noted that "the move to living with Covid-19 will be an economic and psychological test for Australians".

"In exiting past lockdowns, Australia was rebounding into a virtual Covid-zero world where people were confident to venture out to spend," he wrote in The Australian Financial Review on Wednesday.

"Soon, Australians will have to emerge from their caves with thousands of daily virus cases circulating in the community, even if hospitalisation and death rates are kept at manageable levels."

Endorsing similarly cautious optimism when citing the latest economic numbers, Mr Frydenberg told Parliament on Wednesday: "Our economy is strong, our economy is resilient and our economy will bounce back strongly once restrictions start to ease."