Forecasts for future deficits are expected to be reduced in the latest half-yearly economic and fiscal update from the Treasury.
However this is unlikely to prompt the Government to loosen the purse strings in next year's Budget.
The Treasury predicted a period of budget deficits of between $8 - $9 billion at the time of May's Budget.
Eonomists expect these to be lowered by up to $2 billion when Treasury issues its latest forecasts on Tuesday.
Prime Minister John Key says the Crown's books are still under pressure. He says there is still a need for spending restraint and more revenue to lower future Budget deficits.
Radio New Zealand's economics correspondent says tax revenue was $1.6 billion lower for the four months to the end of October than forecast in the Budget.
