Australia’s government posts $14.2 billion budget surplus after 15 years in the red

CANBERRA, Australia (AP) — Australia’s government reported Friday that it had a budget surplus of 22.1 billion Australian dollars ($14.2 billion) in the last fiscal year, the first time the nation’s books have been balanced in 15 years.

The government cited low unemployment and high prices for the country’s commodities, including iron ore, coal and gas. The surplus was equivalent to 0.9% of Australia’s GDP,

The positive showing for the year that ended June 30 was larger than the AU$4.3 billion ($2.8 billion) surplus forecast in May. And it was a vast improvement from the AU$77.9 billion ($49.9 billion) deficit forecast ahead of elections in May 2022.

But Treasurer Jim Chalmers said he did not expect another budget surplus in the current fiscal year, citing China’s economic problems and recent Australian interest rate rises continuing to weigh on growth.

“We’re not currently anticipating a second surplus for the time being,” Chalmers told reporters.

In announcing the surplus, he pointed to 550,000 jobs created since the center-left Labor Party government was elected last year. Australian Bureau of Statistics data show Australia’s jobless rate was 3.7% in August.

The government’s corporate tax receipts for the last fiscal year also came in AU$12.7 billion ($8.1 billion) better than forecast in May, which reflects high prices for coal, iron ore and liquified natural gas. The energy prices have been inflated in part by Russia’s invasion of Ukraine.

Australia’s central bank has left the benchmark cash borrowing rate steady at 4.1% at its last three monthly board meetings, which some economists say suggests that the 12th consecutive hike in May would be the last increase for a while.

The government’s last budget surplus was AU$19.7 billion ($12.6 billion), or 1.7% of GDP, in the 2007-08 fiscal year, recorded months before the global financial crisis plunged the nation’s books into red.