Canberra sees wider deficit as commodities slide

Sydney

AUSTRALIA'S government expects its budget deficit to balloon to A$40.4 billion (S$43.7 billion) in the year to June as falling prices for key resource exports and sluggish wage growth blew a gaping hole in tax revenues.

Releasing his mid-year budget outlook on Monday, Treasurer Joe Hockey predicted that the economy would grow by 2.5 per cent in 2014/15 before picking up to 3.5 per cent over the next few years, while unemployment was likely to peak at 6.5 per cent.