The International Monetary Fund has praised the Albanese Labor Government’s management of the budget and the economy in a new report released today.
In its Article IV Report, the IMF lauded Australia’s economic performance, the Government’s management of the budget and reform agenda.
This statement is a powerful endorsement of Labor’s responsible economic and fiscal management.
While inflation is still higher than we would like and we’re focused on addressing inflation while boosting productivity, the IMF’s report shows that our economic agenda with cost-of-living relief, budget repair, and economic reform is the right approach.
“The Commonwealth has built a strong fiscal position that can help buffer future fiscal headwinds,” the IMF said.
The IMF also said fiscal policy was consolidating and supporting a handover from public to private demand.
“Starting in FY2026/27, a gradual fiscal consolidation will facilitate a handover from public to private demand, rebuild fiscal buffers, support external stability, and moderate pressure on the current account.”
This has only been possible because of our fiscal strategy which the IMF has described as “effective”’.
The IMF also highlighted the private sector recovery underway in Australia’s economy with growth and investment picking up quickly.
“Economic growth gained momentum in 2025. After a modest increase in 2024, supported primarily by public demand, real GDP growth reached 2.1 percent y/y in 2025Q3 as private domestic demand recovered to become the main growth driver.”
The IMF has described the Government’s reform agenda as “bold” and recognised our efforts across multiple fronts, including:
- Our “multi-pronged strategy” to address productivity growth.
- Boosting competition and business dynamism, saying we have made “significant achievements” including through banning non-compete clauses.
- The opportunities for enhancing investment, productivity and diversification through our settings for the green transition including the 2035 targets.
- How we have advanced AI innovation, upskilling and investment through initiatives like the National Reconstruction Fund and the Investor Front Door.
Under Labor, economic growth is picking up, business investment is strengthening, unemployment is low, participation is at near record highs, real wages are growing, debt is down and the budget is stronger but we know there are big challenges too.
We’ve made a lot of progress together on the economy but the job’s not done because inflation is too high and people are still under pressure.
That’s why we continue to address inflation and roll out responsible cost of living relief at the same time as we modernise Australia’s economy.
Despite all the progress we’ve made, we recognise that we still have challenges in our economy like inflation and productivity and we’re focused on addressing them.
The three big economic priorities for the Albanese Government this year are addressing inflation, productivity and global uncertainty, and the IMF’s report shows why that’s the right approach.