15 Jul The fiscal cliff is more likely to be a fiscal slope
Key Points:
- The threat to the recovery from the “second wave” of coronavirus cases necessitates additional fiscal support in Australia, with the Government recognising this.
- Australia’s federal budget deficit is now expected to peak at around $220bn this financial year, or around 11% of GDP, its highest since the end of WW2.
- This is unlikely to cause a major problem as public debt is low, borrowing costs are very low, the Government is borrowing in $A’s & its not dependent on foreign capital.