(Bloomberg) --
Australia's federal budget, due later this month, will focus on households under strain from soaring prices of everything from bread to gasoline, Assistant Treasurer Michael Sukkar told Sky News in an interview.
“Cost of living is a significant issue,” the minister said. “We have an economic recovery underway, but it can't be taken for granted. We'll take into account the fact that households are feeling the pressures of cost of living and that will be something that is certainly a focus of the budget.”
Income Squeeze Is Headache Australian Voters Care About Most
Australian consumer sentiment tumbled this month as Russia's invasion of Ukraine, flooding in the nation's northeast, rising prices and the prospect of higher interest rates spooked households.
Strong household spending is critical for Australia's economic outlook given private consumption accounts for roughly 60% of the country's A$2.2 trillion ($1.6 trillion) annual economic output.
The economy is on a strong path to recovery following the end of virus lockdowns late last year and underpinned by solid consumer spending, fiscal support and interest rates at a record low 0.1%. However, Sukkar said that recovery “is not assured” and that economic decisions will need to consider a period of “great instability” in the world.
The budget is due on March 29.
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