Australian Treasurer expects Federal budget to tackle high inflation

Federal budget to tackle inflation: Australian Treasurer Jim Chalmers expressed optimism on Sunday that the upcoming federal budget would alleviate the country's persistent inflation challenges, which have been squeezing the finances of many Australians.

In an interview with the Australian Broadcasting Corp, Chalmers highlighted the budget's expected impact on inflation, stating, "We do expect the budget, as I said, to put downward pressure on inflation rather than upward pressure on inflation."

The Reserve Bank of Australia's economists have projected consumer inflation, which stood at 3.6 per cent in the first quarter, to rise to 3.8 per cent by June and remain at that level until the end of the year. This underlines inflationary pressures the country is facing.

To combat high inflation, the central bank has raised interest rates by 425 basis points since May 2022, reaching a 12-year high of 4.35 per cent.

Chalmers emphasized that while the budget would primarily target inflation, it would also address other important areas. He stated, "The budget will be a responsible budget, it will ease cost-of-living pressures and it will invest in a future made in Australia."

The budget, to be presented on Tuesday, is expected to focus heavily on housing. This sector has been particularly affected by rising rents, interest rate hikes, and escalating living costs, exacerbating Australia's already challenging housing rental market.

Despite the additional spending measures, Chalmers has indicated that the government remains committed to achieving a surplus, suggesting a balanced approach in the budget to navigate the current economic challenges.

The federal budget's details will be closely scrutinised as Australians look for relief from the economic pressures brought on by high inflation and seek reassurance about the government's economic management strategies.

(with Reuters inputs)