Jim Chalmers, Australia’s treasurer, has warned on Monday that events in the Middle East are contributing to concerns for the global economy and will impact the government’s budget in May. In recent meetings with G20 finance ministers and central bankers in Washington, Chalmers emphasized the importance of responsibility and security in the upcoming budget. He expressed his concerns about the combination of ongoing inflation and weaker growth, further exacerbated by the situation in the Middle East.
As a result of these events, the Treasury is planning to adjust its growth forecasts for key economies such as China, Japan, and Britain. China’s 2024 growth forecast has been revised slightly upwards to 4.75%, but lower next year’s outlook by 0.25 percentage points to 4.25%. Japan’s growth forecast for this year has also been reduced by 0.25 percentage points to 0.75%. Despite expectations of a budget surplus for the year ending June 30, the government anticipates a smaller revenue increase compared to the previous year due to falling commodity prices and a softening labor market.
To address these challenges, Chalmers highlighted downgrades in the near-term outlook for major trading partners as a result of these events. He expressed his concerns about cost-of-living pressures and stressed the need to repair the budget while reforming the economy to counteract escalating risks worldwide. The Treasury is closely monitoring global economic developments and preparing to address these challenges in the upcoming budget to ensure stability and security in the face of uncertainty.
In conclusion, Australia’s treasurer Jim Chalmers has warned that events in
