Sydney, Australia, Dec 13 (EFE).- The Australian government announced Wednesday a reduction in the budget deficit amid high living costs and forecasts of moderate economic growth.

The projected deficit for this fiscal year – which runs from July 1 to June 30, 2024 – is AUD 1.1 billion ($721 million), Treasury Minister Jim Chalmers announced.

“This is an improvement of $12.8 billion compared to the May Budget,” Chalmers said while presenting the mid-year budget outlook.

The minister added that the treasury was being cautious and conservative while forecasting revenue.

“We are not yet forecasting that second surplus, for good reason, but we are within striking distance,” he added.

Chalmers has been in charge of the Australian treasury since Prime Minister Anthony Albanese took office in May 2022.

During the last fiscal year, Australia posted a budget surplus of AUD 22 billion, the first one in 15 years.

Chalmers attributed reduction in the deficit to an increase in revenue, savings, as well as a downward revision of the gross national debt to 35.4 percent of the GDP in the 2027-28 fiscal year before declining to 32.1 percent in the medium term.

Government forecasts also predict a 1.75 percent expansion of the economy during the current financial year, moderate growth that is expected to improve during 2024-25.

The government linked the economic slowdown in the country to high inflation, which stood at 4.9 percent in October mainly due to high global fuel prices, high interest rates of 4.35 percent, as well as the uncertainties of the global economy. EFE

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