Commonwealth Mid-Year Economic Forecasts and Outlook December 2015
- GDP growth in 2016 now expected to average 2.50% (May forecast: 2.75%)
- GDP growth in 2017 now expected to average 2.75% (May forecast: 3.25%)
- Unemployment in 2016 now expected to average 6.0% (May forecast: 6.50%)
- Terms of trade now expected to be -10.50% in 2015/2016 (May forecast: -8.50%)
- Terms of trade now expected to be -2.25% in 2016/2017 (May forecast: +0.75%)
- 2015/2016 budget deficit now expected to be $37.4 billion (May forecast: $35.1 billion)
The Federal Government’s Mid-Year Year Economic Forecasts and Outlook was released on 15 December and its forecasts and statements were brought closer to those in the private sector.
Over the next four financial years, the cumulative deficit is expected to be $118 billion versus the May Budget forecast of $92 billion and the return to a balanced budget is now expected to occur in 2020/21 rather than 2019/2020. The larger 2015/20156 deficit and one year delay in a return to surplus are due to lower expected tax receipts arising from lower commodities prices (less profits than previously expected) and lower population growth (less tax payers than previously expected). While Government receipts over the next four years have been lowered there is some offset as projected unemployment payments are now lower.
