Friday, October 14, 2011

Surprised by Joy. How Treasury underestimated China.

And others did it worse

Treasury now releases reports of the Joint Economic Forecasting Group (JEFG) Committee after a period of 2½ years.

Today it released the JEFG report of March 2009 mid-crisis, when things looked particularly murky.

Here's how it thought our terms of trade would pan out:

Note: The budget forecasts that flowed from this were derided by "experts" as unrealistically optimistic.

Check out the 7.30 Report's "Expert Budget analysis" that night.

RICHARDSON: "Some of those growth assumptions are optimistic"

KOHLER: "A colossal turnaround that they’re forecasting which I don't think is credible at all"

BRISSENDEN: "The optimistic growth figures are are going to underpin the Government's argument about returning to surplus"

Here's how things turned out:

Another one of its "optimistic" forecasts was that unemployment would peak at 8.25 per cent.

We've all been surprised by joy

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