The Australian labour market seems to be cooling considerably, which may give the Reserve Financial institution of Australia room to chop key rates of interest once more in August, Commerzbank’s FX analyst Volkmar Baur notes.
Australia jobs information factors to August RBA lower
“With simply 2,000 jobs added, the labour market fell in need of analysts’ expectations. And after simply over 1,000 jobs have been lower final month, there was just about no job progress within the final two months. To be honest, it should be mentioned that April noticed a particularly robust labour market, so this might nonetheless be a pause for breath. Nevertheless, the unemployment price additionally rose to 4.3%, its highest stage in virtually 4 years, though this was supported by a slight improve within the participation price.”
“It’s subsequently too early to say whether or not that is actually the start of a slowdown within the labour market or whether or not it’s simply one other breather earlier than one other robust labour market report. Nevertheless, I believe that it must be sufficient to make the RBA’s determination to chop rates of interest in just below 4 weeks’ time in August somewhat simpler. The market has totally priced on this transfer, so the AUD shouldn’t be negatively affected.”
