Australian Treasurer Chalmers said on Sunday that this week’s federal budget is expected to help ease the country’s stubbornly high inflation as many Australians continue to deal with cost-of-living pressures.
Economists at the Reserve Bank of Australia forecast that consumer inflation would rise to 3.8% in June from 3.6% in the first quarter and remain at that level until the end of the year, highlighting local inflation challenges. Since May 2022, the central bank has responded to persistently high inflation by raising interest rates by 425 basis points to a 12-year high of 4.35%.
Chalmers said the budget due to be published on Tuesday would be “primarily, but not exclusively, focused on inflation”. “The budget will be a responsible budget that will ease cost of living pressures and invest in the future of Australian manufacturing,” he added.
Officials said on Tuesday the budget would focus on housing as rising rents, rising interest rates and soaring costs of living in recent years have exacerbated what was already the world’s most unaffordable rental market. Chalmers said the government would chart a responsible middle path in a budget that would put it on track for a second surplus despite more spending measures.
