Australia: MYEFO’s budget assumptions were a little more realistic - TDS

Analysts at TDS note that the Australian MYEFO’s budget assumptions were a little more realistic compared to May, trimming wages to 3.5% by 20/21.

Key Quotes

“Growth at 3% is the usual assumption. We suspect the better outturn this year and next is the only reason behind the return to surplus. Still an absence of decent fiscal reform (broadening tax base and cutting spending) and therefore we see no reason for S&P to remove negative outlook this time, hence zero market implications.”