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Fiscal outlook improving, housing outlook bleak

The rapid improvement in the budget deficit will allow the government to use the upcoming Mid-Year Economic and Fiscal Outlook to deliver some early Christmas presents. But the Treasurer will probably reiterate its pledge of achieving a budget surplus in the coming financial year. Meanwhile, we expect house prices in Sydney and Melbourne to fall by more than during any previous downturn, which is a key reason why we expect GDP growth to soften next year.  

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