Economists say that the government's tough budget could drive confidence to recession levels and delay future interest rate hikes until late next year.

Their assessment comes as the government prepares to issue $36 billion in new bonds to help get the economy back to surplus.

"This budget, which does contain a reasonably broad-based tightening of fiscal policy, can only mean that rates will stay lower for longer or when they do go up they will go up more gradually," said ANZ chief economist Warren Hogan.
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Mr Hogan said he will be closely watching consumer confidence levels over the coming weeks, given that they are dangerously close to recession levels.

The market is pricing in a 44 per cent chance of a rate hike by the Reserve Bank in the next 12 months.

Higher rates have an impact on borrowing costs and the interest rate associated with the paying back of new government debt, in that it will make it slightly more expensive.

On Tuesday night Treasurer Joe Hockey declared that it was time all Australians acted in the national interest and did their part by contributing to a better Australia with less debt

All this is happening because of Labor's debt, deficits and criminal economic mismanagement.

The children are now in opposition thankfully, and the adults are now in the process of fixing up the economic mess left by Labor.

Right is wrong....one side spends and the other side reaps it back.....the 101 of politics;)

Kat

one side spends and the other side reaps it back.
Origins of Man,
Not quite like that.
The ALP stole our money to give to itself & it's non-deserving, non-contributing hangers-on.
The LNP now has the unenviable task of making people live within their means, although it would have been much, much better if the present Government had knocked back the last salary increase as well.

Many Labour pollies having grown up with the union mentality that its ok to spend cleaners money on prostitutes and lavish living had no trouble splashing other peoples money around. Now its time to clean up the mess again. When are the voters ever going to wake up? Labour pollies taking their abc lovers on trips just before getting kicked out sums up the way they handle money. Some in the current Government are not much different however at least a few have had to work real jobs so know the value of a days work. Yep Labour get the spending going but only with other peoples money.

btw 579 by saying 'Economists say that the government's tough budget' u r talking about highly paid soothsayers. Almost none of them predicted the gfc or stock market crashes or housing booms or busts. They are like weather forecasters who are always wise after the event. They know about as much about the future as the gw alarmist know about future weather events. They guess, often get it wrong and then forget all their dud predictions in announcing the next forecast. The science on economics like weather is certainly not settled the bible makes the most accurate prophecies on both.

Runner ". The science on economics like weather is certainly not settled the bible makes the most accurate prophecies on both."
Really?
What prophecies?
Is that the one where it rained for 40 days and flooded the world, and Noah took all the animals of the world in pairs onto his boat, and his family, and then they all hopped off the boat and Noah's kids populated the world......with each other?

As for consumer recession, I agree with 579.
We are in for trouble, and I doubt either Government can say they didn't contribute to this mess!

What prophecies? These prophecies http://www.reasons.org/articles/articles/fulfilled-prophecy-evidence-for-the-reliability-of-the-bible

Now you can apologise for doubting runner and the Lord.

The LNP has been in power for only a matter of months. The economic mess and complete emergency we currently have is because of 6 years of horrendous Labor ineptitude. Only bind Freddie, or blind Susie, wouldn't realise that.

's that the one where it rained for 40 days and flooded the world, and Noah took all the animals of the world in pairs onto his boat, and his family, and then they all hopped off the boat and Noah's kids populated the world......with each other?'

actually that is one Susie. The fact that you ignore all the evidence of the flood simply shows how blind you are. Instead you seem to hold to the dogmas such as order from chaos in order to validate you unscientific and ungodly dogmas.

The Left are getting dangerously stupid. Looks like they're in bed with Egyptian lawyers.

We have been in trouble for a few years now. Even the deniers are starting to see the wheels wobble.

Governments MUST remember one very important economic fact, that being, you can only spend money once and, if it's wasted, then you end up just where we are today. Consumer recession as more and more are unsure about their futures.

It's not rocket science, it's simply at matter of people not willing to spend their money if they are not sure they can replace it.

The warnings were there loud and clear, it's just that too many thought us being in better shape than others was all that mattered. What a pity they didn't see this coming.

Consumer confidence has steadied at a strongly negative level, failing to recover from a post-budget slump.

With a raft of retailers reporting worse than expected sales over the past couple of months, the widely watched Westpac - Melbourne Institute Index of Consumer Sentiment has failed to offer much hope.

The index rose just 0.2 per cent in June to 93.2 - still well off the 100-point level where optimists equal pessimists.

Westpac's senior economist Matthew Hassan says the result shows the post budget blues are far from lifting.

"Sentiment has stabilised after registering a sharp fall in the wake of the Federal Budget last month," he observed in the report

Yes, and consumers have also found themselves in uncomfortable waters.

While many would suggest the Abbott experiment has been a failure, they also realize that to change back to labor would mean more of the same as we had.

You then look at the likes of Palmer as an alternative, yet he says we should defer company taxes by 12 months because, his words, the extra $70 billion will raise more GST. But hang on, businesses don't pay net GST as they get it all back.

I'm afraid politics has become a game of snakes and ladders, but the ladders are gone, all replaced with snakes. I say this because once again labor are more popular, not because they have improved, but because the libs have slipped.

The race to the bottom continues.

Lester1

like the website. The main problem is not belief but sin. People choose not to believe not because of 'reason'or 'science'. Most of them know how idiotic evolution is. They choose not to believe the Son of God because it exposes their need of a Saviour. They would rather continue to ignore their conscience and produce pseudo science as an excuse.

You must believe the latest budget is somewhat over cooked or badly thought out.

Would have been far better to leave things as is and raise the GST.
It is obvious that we like our lifestyle as is, but it needs more funds to pay for it.

Something easier to sell than 20 different items.

A sliding scale of GST, i% rise this year and another 1% next year .

I am afraid our fearless leader can;t wait that long as he has a multitude of hidden agenda's that we haven't even heard of yet.

579, I think you will find that $36billion in new bonds is to cover old
bonds that have matured. They have to keep doing this and gradually
not cover a few that have matured. That is the way that government debt is reduced.

And that has been going on for years, but it is not the sort of thing you will get from Abbott or Hockey, it is not in their interests.

They feel better when are trashing the AU economy, which has come back to bite them.

Our economy is going along at 3.5% which is about maximum before inflation or interest rates cut in.

So we have minimal problems, except for those who want AU to be in recession to push their own barrow.

Our economy has done very well considering what the rest have and are going through.

It's good to see the mining sector going at a steady pace instead of going gangbusters and wreaking havoc on our industrial sectors by stealing their trades and experience.

All we want is a govt; without hidden agenda's and be humane to our populous without favor.

579;
And that has been going on for years,

No it has not, otherwise the debt would not have increased.
More has been issued than matured.
If they can issue less than matured the debt will reduce.

runner,

"Most of them know how idiotic evolution is"

Do they indeed?

But for me the big question is why do all those famous religious painters depict Adam and Eve with belly buttons?

Mon Ami
Touché Poirot !

.....But for me the big question is why do all those famous religious painters depict Adam and Eve with belly buttons?

Exactly, it's been a well oiled scam for generations, reaping billions of often TAX FREE money out of the system.

I just wish believers in god and creation would simply go about their business and mind their own business at the same time. In other words, believe what you wish but don't preach it.

Back to the recession. We must keep in our minds that Ford, Holden and Toyota are still here and mining is still employing, for now.

If you think consumer confidence is low now, you ain't seen nothin yet!

Take away mining and manufacturing and we will be far worse off than the likes of Eurooe because we have a very small population spread out across a very vast country which makes servicing our needs so much more expensive.

If our budget is not balanced within this term, which it won't be, we are in for a hiding to nothing as there is a train wreck in the making the likes of few alive today have ever seen. Ignore it at our peril I say, but the damage has already been done.

Bazz AU bonds started around the time of the second world war. By off setting when they are bought and mature. That way Debt is managed. There is nothing new there.

Butch is of the conclusion Debt is paid with cash money, Mining is hiring to replace the ones that leave. Never again go into a boom and bust cycle, it done exactly nothing for our GDP. The only ones that it affected was the likes of Gina and other multinationals.

It’s not what the Treasurer can do for you, but what you can do for the Treasurer – as he obviously needs all the help he can get.

The whole nation suffers when consumers lose heart. Thus Joe Hockey's spectacularly unpopular first budget is proving economically damaging as well. While the Reserve Bank's verdict is out on the implications of the sharp consumer confidence dive, the budget itself features a sharper fiscal contraction than the central bank expected

New government legislation will add about $100 million a year to the cost of providing broadband in Australia and this may mean that your annual internet bill could rise by about 5 per cent.

The cost to Australian business will be substantial. Telcos will be given the onerous task of ‘stopping the bytes’: identifying pirates and additional compliance costs. The rest of Australian business will have to bear the cost of monitoring corporate networks to prevent illegal file-sharing, and public Wi-Fi providers could be fined if their service is used for illegal file-sharing…

And why is the government taking punitive action against the telecommunications industry when similar laws of inspection and disclosure of illegal goods are not in force against shipping and other transportation companies? Because compliance will add a significant cost and achieve very little.

The Reserve Bank forecasts that its stimulatory monetary policy (record low interest rates) will see GDP growth continuing through 2013 and 2014, and a return to 2.5% to 4% GDP growth through 2015, which would be a tremendous result if it actually eventuates.

Abbott's budget may yet result in a recession, with consumer confidence below 1990 level.

Our economy is going along at 3.5% but people are not bying commodities. What a brainless govt;.