6 weeks in and Budget trade forecast’s already toast

Thursday 28 January 2016

Don’t say we didn’t warn you. When the Government released its Mid-Year Economic and Fiscal Outlook (MYEFO) on 15 December, we warned that it was not bearish enough around commodity prices and the terms-of-trade.

So it is with little surprise that we read today that Australia’s terms-of-trade is already falling well ahead of the Government’s forecasts less than two months ago, which has Treasurer Scott Morrison sweating. From The AFR:

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About the author

Leith van Onselen is Chief Economist at the MB Fund and MB Super. He is also a co-founder of MacroBusiness. Leith has previously worked at the Australian Treasury, Victorian Treasury and Goldman Sachs.