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© Reuters. FILE PHOTO: Masked customers queue outside a shop in the Newtown suburb in the wake of coronavirus disease (COVID-19) regulations easing, following an extended lockdown to curb an outbreak, in Sydney, Australia, October 22, 2021. REUTERS/Jaimi Joy MELBOURNE (Reuters) – Australia will raise its 2022 economic growth forecast at the mid-year budget review, Treasurer Josh Frydenberg said on Sunday, adding that it is too early to estimate the impact from the Omicron coronavirus variant on the economic outlook.

Frydenberg is due to deliver an update to the budget in coming weeks, halfway through Australia’s fiscal year which ends in June.

Australia’s economy shrank a steep 1.9% in the third quarter as the Delta outbreak put half the population under lockdown, though a speedy recovery is underway as the country sets a world-beating vaccination rates.

“The market is coming back strongly,” Frydenberg said in an interview on the Australian Broadcast Corporation’s “Insiders” programme, pointing to numbers showing growth in jobs and retail sales.

“That comes as a result of the fact that we now have one of the highest vaccination rates in the world, one of the lowest mortality rates in the world.”

Health data shows that 88% of Australians over the age of 16 are fully vaccinated and nearly 93% have received one dose.

Asked whether Omicron, the new variant that has also been spreading in Australia, would pose a threat to the economic outlook, as indicated by the International Monetary Fund, Frydenberg said there should be no panic.

“It’s too early to make any conclusive decisions or estimates about the economy as a result of Omicron,” Frydenberg said.

He did not say whether the expected upgrade to growth would be for 2022 calendar year of fiscal year, which start in July. The budget released in May forecast a 4.5% expansion for the 2021-22 fiscal year before slowing to 2.5% the following year.