As for the pace of consolidation, it is important that it should be measured, with each step taken in confidence that the economy remains on a sustainable growth path. That is how fiscal consolidation has proceeded to date.
Expectations for Australia’s trading partner group itself are for growth to be a bit below average, little changed from six months ago. Inflationary pressures globally look quite subdued. Global interest rates will still be very low, even if short-term rates move up a bit further in the United States.