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From the AFR:
A worse-than-expected decline in the iron ore price since December has forced the federal government to downgrade revenue predictions by another $1.8 billion a year, making the dwindling prospect of balancing the budget even more remote.
As Prime Minister Tony Abbott told his MPs on Tuesday that he still expected to return the budget to balance “in about five years”, sources said the decline in the ore price to $US56 ($73), below the conservative annual average price estimate of $US60 in the mid-year budget update, has forced another revenue downgrade in the forthcoming May budget.
Just wait until we’re at $40 per tonne.
About the author
David Llewellyn-Smith is Chief Strategist at the MB Fund and MB Super. David is the founding publisher and editor of MacroBusiness and was the founding publisher and global economy editor of The Diplomat, the Asia Pacific's leading geo-politics and economics portal.
He is also a former gold trader and economic commentator at The Sydney Morning Herald, The Age, the ABC and Business Spectator. He is the co-author of The Great Crash of 2008 with Ross Garnaut and was the editor of the second Garnaut Climate Change Review.
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