Australia's economy looks to be in surprisingly decent shape, according to the IMF, as it navigates a worsening global recession

• The Australian economy has improved its standing in the eyes of the IMF as it upgrades its forecasts.

• The economy will still shrink by an mighty 4.5% this year, but it's a big improvement on the 6.5% fall the IMF forecast in April.

• While it expects a 4% recovery for Australia in 2021, a global recession threatens to wipe out $17 trillion worldwide.

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Australia won't emerge from a global recession unscathed, but it at least appears to be in a strong position to get through it.

Updating its assessment of the world economy, the International Monetary Fund (IMF) has upgraded its view of how Australia will navigate the crisis.

While the Australian economy will still contract by a considerable 4.5% this year, according to the global organisation, it's a damn sight better than the 6.7% it was calling two months ago.

Again, the IMF forecasts the subsequent recovery in 2021 should erase much of the losses, with the economy bouncing back 4%.

The improved diagnosis comes in the same report the IMF actually downgrades its global forecasts.

"Compared to our April World Economic Outlook forecast, we are now projecting a deeper recession in 2020 and a slower recovery in 2021," chief economist Gita Gopinath wrote in a note on the analysis.

"Global output is projected to decline by 4.9% in 2020, 1.9 percentage points below our April forecast, followed by a partial recovery, with growth at 5.4% in 2021."

The IMF puts the collective 2020 and 2021 losses from "The Great Lockdown" at a cost of $US12 trillion, or around $17 trillion in local money.

Australia has no doubt been helped by its early efforts to contain the coronavirus outbreak sooner than others, sparing its healthcare system and allowing it to begin to reopen its businesses.

The IMF noted it had been among a "few exceptions" as countries suffered a worse than expected March quarters.

Equally, the island nation's geography has put it in an advantageous position relative to others to safeguard its progress. Early indications suggest – possible second waves notwithstanding – it will be able to open fully both domestically in July and to New Zealand thereafter.

The most concerning development so far has been a spike in Victorian cases, which has again seen other states grow cautious in reopening completely.

With the Prime Minister warning that the lifting of restrictions, such as those barring international students from being flown in, is reliant on state government cooperation, a spate of new cases could threaten the recovery effort.