CBA: Labour Market To Remain Strong Over Coming Months

Ahead of today’s labour market report CBA note that “the RBA will be watching developments in the labour market closely to determine the impact of their tightening on the demand for labour. The labour market remains extremely tight, though it is likely a turning point has been reached in terms of labour demand. Measures of job vacancies are off their peak and with large migration inflows in the pipeline, more slack in the labour market is likely to come through during 2023. Vacancies do remain elevated and we think labour market will remain strong over coming months. Trend employment growth is edging lower but is likely to remain solid in the near term. As such, we forecast a 25K increase in January. Provided the participation rate remains steady, we expect the unemployment rate to be flat at 3.5%”