With Treasury Joe Hockey and Finance Minister Mathias Cormann currently preparing the Abbott Government’s second Budget, and facing up to the collapsing iron ore price (and terms-of-trade), it is worth looking back at Treasury’s outlook for commodity prices and the terms-of-trade back in 2011, just as iron ore hit its all-time high:
The global economy is undergoing a transformation unprecedented in the last 100 years. Geo-strategic and geo-economic weight is moving, inexorably, from the Western advanced economies towards the emerging market economies. And the pace of this transformation is faster than many anticipated. Key emerging markets from Australia’s perspective are China and India.
