The Treasurer, Scott Morrison, releases the Mid-Year Economic and Fiscal Outlook (MYEFO) this week, and if anything, there’s more pressure on him now than when he brought down the main budget in May.
This time it’s clear that the ratings agencies, especially Standard & Poor’s, is itching to take away Australia’s coveted AAA credit rating, not because the Government’s fiscal position is terrible, but because it’s not getting better fast enough to offset the terrible household debt situation.
MYEFO is likely to reveal a deterioration of the budget due to slow wages growth holding back bracket creep, and Standard & Poor’s could downgrade immediately.
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