Daily Flows & Insights – Federal Budget returns to Surplus in 2023

Daily Flows

  • A limited rate of 5.05% for 1 year in the BBB space continues to be offered.
  • With the yield curve inverting opportunities like this gather a lot of interest as market participants look for elevated yields.
  • The NCD margins continue to remain elevated with a bid side tone. Today a margin of +45 is being offered to attract.

Federal Budget returns to Surplus in 2023

  • Australia’s federal budget position is set to briefly return to surplus this year for an amount of $4.2Bn (0.2% of GDP).
  • It is expected to fall back into deficit in 2023-24 onwards.
  • This return to surplus has been supported by significant boosts in revenue that will lower future expected deficits.
  • The Governments budget reflects its reprioritisation of key themes with significant relief on the cost of living across marginalised groups.
  • With the unemployment expected to rise while Australia looks to cool inflation, it is expected that an increase in unemployment will have a significant focus in future policy and budgets.
  • The budget assumes an inflation peak in 2023, with it slowing to 3.25% by 2024 and 2.75% by 2025.
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Curve Team
Jack Pedersen