Expectations of an interest rate rise have jumped after new figures show the country added more than 76,000 jobs through June even though signs grew that the overall employment market is weakening. Source: Sydney Morning Herald.
A possible rate rise could come at the worst possible time for borrowers, with warnings petrol prices could push through $2 a litre after Iran-backed Yemeni rebels attacked oil tankers in the Red Sea and fears shipments of oil out of the Middle East will be effectively shut down.
The Australian Bureau of Statistics on Wednesday reported that in June the jobless rate was steady at 4.4 per cent seasonally adjusted, in line with most economists’ forecasts. The more steady trend measure of unemployment slightly increased and is now, to two decimal places, at its highest level since the depths of the pandemic.
The under-employment rate also lifted to a two-year high, climbing to 6.5 per cent in a traditional sign that steam is coming out of the jobs market.
But the bureau said 76,300 jobs were created last month, well above market expectations.
The surge in jobs coincided with the period during which the bureau starts employing people for next month’s national census, with the proportion of people aged between 55 and 64 in a job reaching an all-time high.
It was the largest one-month increase in jobs for at least a year.
The stronger-than-expected employment numbers pushed the Australian dollar up beyond US70 cents on expectations the Reserve Bank – which meets next month – will have to consider a further lift in official interest rates.
Ahead of the data, financial markets put the chance of a rate rise in August at one-in-five. After the figures, the chance lifted to one-in-three.
Treasurer Jim Chalmers said the figures showed Australia had created more jobs under the current government than any major advanced economy.
Liberal Party deputy leader Jane Hume said the figures showed older Australians were being pushed into work to deal with cost-of-living pressures while younger people faced an unemployment rate above 10 per cent.
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Rate hike fear grows as nation adds 76,000 jobs in June (By Shane Wright and Mike Foley, Sydney Morning Herald)
