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NSW Slashes 2026–27 Growth Outlook to 1% as Oil Shock Bites

The treasurer says hefty mortgages make NSW more sensitive to higher interest rates.

Overview

  • NSW Treasury cut next year’s growth forecast to 1% from 2.5%, blaming the Middle East war’s hit to oil prices and the inflation that followed.
  • Treasurer Daniel Mookhey said larger home loans make the state more exposed to rate hikes, with a new NSW mortgage averaging about $873,000 versus $677,000 in Victoria.
  • He released the downgrade a month before the June budget to flag that fuel‑driven inflation will linger even if fighting ends.
  • Mookhey said a wave of renewable projects and major grid upgrades should keep the state out of recession.
  • He pressed the NSW Liberal Party to back legislated net‑zero targets before the election, pointing to One Nation’s gains as a test of the state’s clean‑energy path.