Treasurer Chalmers touts booming investment despite domestic economic gloom

At a Sydney gathering of investors, Treasurer Jim Chalmers reported that business investment is on track to expand at more than double the pace predicted in May, translating to an extra $50 billion for the year. He pointed to rapid foreign-investment approvals, with $278 billion cleared so far and a majority processed within a month, and noted AI-related data-centre projects as a key catalyst. Despite this optimism, the Treasury will issue a mid-year budget update forecasting higher unemployment and slower growth, reflecting broader domestic challenges.

The investment surge contrasts with rising inflation, a cash rate of 4.60%, and a five-year-high unemployment rate of 4.7%, fueling concerns about further rate hikes. Political tension is growing, as backbenchers and opposition figures criticize recent tax hikes and the government's handling of economic policy. Chalmers framed Australia as a stable haven for global capital amid geopolitical risks from the wars in Ukraine and the Middle East.