CANBERRA – Australia’s Prime Minister Scott Morrison said on Wednesday the federal government could redraw current plans for a budget surplus next year if the economy worsens.
Morrison’s comments came ahead of the scheduled release of second-quarter gross domestic product data that is expected to show a significant slowdown in the pace of economic expansion.
Consensus expectations are for a 0.5-percent quarterly rise, bringing the annual growth rate to 1.4 percent, which would be the slowest in several years.
Australia is on a 27-year run without a recession – the longest ongoing growth streak in the developed world – but faces headwinds including weak consumer spending, tepid inflation and a darkening global outlook.
Some bright spots are emerging, however, including a recent pickup in house prices, while the unemployment rate remains relatively low.
Morrison said the government intends to maintain its current surplus trajectory for now, while watching economic developments.
“What I’ll do is continue to monitor the implementation of our plans,” he said. “We will stay the course, we will be consistent, we will be measured, we will be reasoned.”
Morrison said Australia’s economy continues to perform reasonably well despite softening conditions, in contrast to contractions in Europe and some other parts of the world.