sydney - Australian Treasurer Wayne Swan on Sunday warned a high dollar and lower terms of trade had led to a $7.7 billion "sledgehammer" hit to budget revenues.
Swan is due to hand down his annual budget next month ahead of national elections in Sept, having only in December abandoned his strident and long-held vow to return it to surplus this year.
He said the country was now facing some of the most challenges circumstances it had seen in decades, describing lower terms of trade -- the value of exports measured against imports -- and a high dollar as a "unique economic event".
The upshot was a dramatic impact on the profitability of companies and prices more generally in the economy, particularly for Australia's key mining products.