Chalmers confident Australian economy has ‘turned the corner’ in battle against inflation

Forecasts show underlying inflation within Reserve Bank’s 2%-3% target range six months earlier than expected in prediction that will add to calls for another interest rate cut

• Federal budget 2025 LIVE updates: Australia government budget announcement and speech – latest news
• Explore all of our 2025 Australia federal budget coverage
• Get our morning and afternoon news emails, free app or daily news podcast

Treasury has largely declared victory in the protracted battle to tame inflation without tanking the economy, with the budget papers predicting the country will complete its “soft landing” by the middle of this year.

The latest forecasts show the rate of underlying inflation – taking into account the flattening effects of energy rebates – will be “sustainably” within the Reserve Bank’s 2-3% target range by June and six months earlier than expected.

Sign up for Guardian Australia’s breaking news email