* GDP to shrink 3.3% in 2020, rebound 3.4% in 2021
* CPI inflation seen 1.5% in 2020, 2.0% in 2021
By Wayne Cole
SYDNEY, April 16 (Reuters) - Australia is likely already deep into its first recession in three decades as entire sectors of the economy are shut to fight the new coronavirus, throwing tens of thousands out of work and threatening the survival of many businesses.
The gloomy predictions in a Reuters poll are for Australia's A$2 trillion ($1.3 trillion) of annual gross domestic product (GDP) to contract 3.3% in 2020. Just a few months ago analysts had expected the economy to grow 2.3%.
"We expect a recession of unprecedented speed and magnitude for the Australian economy," warned NAB's chief economist Alan Oster. The last time it suffered a recession was in 1991.
"The big hit is in Q2 where we can easily see GDP falling by around 7%, and then falling by another 1%."
Forecasts from the poll were almost as bad, at -6.8% for the June quarter, though many were more hopeful that growth would bounce back in the September quarter with a rise of 1.5%.
If there was a silver lining in the poll it was that analysts saw the economy rebounding by 3.4% over 2021, in part thanks to a massive stimulus effort from policymakers.
Prime Minister Scott Morrison jettisoned much of his conservative government's ideology to pledge spending worth more than 10% of GDP, including a A$130 billion subsidy to employers to keep staff they might otherwise have let go.
Westpac chief economist Bill Evans estimates that without the subsidy unemployment would have soared to 17% by the end of June, but would now "only" reach 9%. It had been at 5.1% in February.
The Reserve Bank of Australia (RBA) has gone all-in by cutting rates to a record low of 0.25% and flooding the financial system with cash, even buying government bonds to bring down yields and borrowing rates for business.
Swift steps to close Australia's borders and contain the outbreak also mean the number of cases has been far below many of its peers and new infections have slowed to a trickle.
Still, authorities are reluctant to relax social distancing for fear of a second wave of infections, making it hard to call when a recovery might start.
"It is simply not possible for households to spend on a range of goods and services when the businesses that provide them are shut," said Gareth Aird, a senior economist at CBA.
"This means that despite the incredible fiscal and monetary policy packages, we do not expect to see a rebound in spending data for the foreseeable future."
(For other stories from the Reuters global economic poll = 1.5605 Australian dollars)