Stronger than expected budget position to fuel calls for cost of living relief, economists say

The Australian government is likely to play down the positive budget position to forestall calls for cost of living relief. Photograph: Getty Images

The Albanese government’s midyear budget update will reveal a fiscal “sweet spot” fuelled by strong commodity prices, population growth and a resilient labour market, economists say.

But experts believe the government is likely to play down the positive budget position in order to curb calls for more cost of living relief that could stoke inflation and keep interest rates higher for longer.