Beating inflation is still the main game but the federal treasurer says Australia's focus will soon shift to keeping the economy growing.
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Jim Chalmers said his government's budget setting and policies would then adapt to those changing conditions but stopped short of committing to economic stimulus.
"What I'm saying is inflation is our major concern, but it's not our only concern," he told ABC radio on Thursday.
The treasurer used a key speech to other finance ministers at G20 talks in Sao Paulo, Brazil, to manage expectations ahead of Australia's quarterly growth figures next week.
"We expect growth in next week's December national accounts to be quite weak - the inevitable consequence of global uncertainty, higher interest rates, and cost of living pressures," he said in his speech.
"The soft landing we seek at home and in the global economy is assumed but not assured."
Dr Chalmers said Japan and UK had tipped into technical recessions in recent months.
"The point that I've been making is we are not immune from that and we're not complacent about that," he told ABC radio after his G20 speech.
But there were also reasons to be optimistic about the economic outlook.
"Global inflation has peaked, issues in the banking system have been well-contained, and growth in some major economies like the United States has defied expectations."
Treasury is forecasting a soft landing for Australia, which involves bringing inflation back within the two-three per cent target range while keeping the economy growing, albeit slowly.
Yet inflation has been softening more quickly than first expected, with the consumer price index holding steady at 3.4 per cent in the 12 months to January against expectations of a bounce.
KPMG chief economist Brendan Rynne said the result reinforced his expectation of no more interest rate hikes in this cycle.
"Given the slowing economy, we believe it might reduce the cash rate sooner and faster than currently envisaged," Dr Rynne said in a note.
The economist said the December quarter GDP figure would be a "close-run thing as to whether they show the economy is going backwards with negative growth".
"There is a risk that Australia could not only be in a per capita recession - given four out of the previous five quarters showed real GDP per capita declining - but could also tip into a technical recession," he said.
Australian Associated Press
