Australian Treasurer Chalmers: Debt forecasts 'confronting'

Australian Treasurer Jim Chalmers said on Monday, taxpayers will find the upcoming government budget update confronting.

The latest debt forecast will be provided on July 28.

Key quotes

Government had inherited the "trickiest set of economic conditions" in memory.

"The news in that statement will be in many ways confronting when it comes to our expectations of inflation.”

"When it comes to the impact of interest rate rises on growth, when it comes to what this spike in inflation means for real wages."

"If you think about the consequences of those rising interest rates on the budget, more than a billion dollars this year, more than $5 billion in the last year ... these are not small amounts of money.”

"The key task of every budget is to make sure that we are getting maximum bang for buck from taxpayers' dollars, which are costing more and more to service because every additional dollar in the budget is a borrowed dollar."

Market reaction

AUD/USD is struggling to hold above 0.6800, despite the upbeat sentiment and expectations of a 75 bps RBA rate hike next month. The renewed uptick in the US dollar is capping the aussie.

The spot was last seen trading at 0.6802, defending 0.15% gains on the day.