In an economic update to Parliament, Treasurer Jim Chalmers has revealed inflation is likely to get worse and real wage growth will deteriorate.
, but Chalmers said this would get worse, likely reaching 7.75 per cent in the December quarter.
“Inflation will unwind again, but not in an instant. Just as the domestic forces contributing to some of the supply side pressures have been building for the best part of a decade, it will take some time for them to dissipate – but they will,” he said.The budget forecast wages to out-pace inflation in 2022-23. Chalmers said it will now likely occur the following year, with wages forecast to grow by 3.75 per cent 2023-24.
by half a percentage point for the current year and 2023-24, in part due to higher interest rates. Chalmers said net exports would drag on growth as would supply issues that had affected the construction sector. Chalmers also revealed the budget - forecast to show a deficit of $79.8 billion last financial year - would show a “dramatically better-than-expected” result.
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