Budget papers reveal lasting impacts of Middle East war - News

The budget papers warn that the Middle East conflict could cause oil prices to surge, leading to a brief contraction of Australia’s economy and a spike in unemployment to pre-pandemic levels due to instability at the Strait of Hormuz. The Treasurer acknowledged the potential for significant economic impact, while also highlighting Australia’s preparedness for global challenges. The government is attempting to curb inflation through spending cuts, but this could exacerbate existing inflationary pressures.