Australia's government, led by new Prime Minister Tony Abbott, said its budget deficit could swell to 47 billion Australian dollars ($42 billion) in the year ending June 2014, according to its latest mid-year economic and fiscal report released Tuesday.
This is a substantial increase from the 30.1 billion Australian dollars forecast by the previous Labour government back in August.
Gross domestic product growth for the current fiscal year is expected to come in at 2.5 percent, unchanged from the Treasury's forecast before the elections in September, but still a far cry from quarterly growth rates of as high as 4 percent last year.
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Addressing reporters in Canberra, Treasurer Joe Hockey said that the budget deficit would balloon to 123 billion Australia dollars over the next four years, and, without policy changes, the budget would be in deficit every year until 2024.