MNI BRIEF: RBA Set To Hike Again After Strong Jobs Data
Strong jobs data, following solid Q3 earnings data, sets up RBA for near certain Dec hike.
A further 25bp hike at the Reserve Bank of Australia's December meeting looks certain after October labour force data showed new jobs more than doubled expectations and the unemployment rate fell back to its equal lowest rate in 50 years. The stronger-than-expected print snapped a run of monthly data that suggested the red-hot jobs market may be losing steam amid seven consecutive rate hikes and increased migration that boosted the supply of workers.
The economy added 32,200 new jobs in October, beating expectations for 15,000, according to the Australian Bureau of Statistics. The unemployment rated edged down to 3.4% from 3.5% in September, as the participation rate held steady at 66.6%.
The jobs data followed Wednesday's release of the September quarter Wage Price Index, which showed yearly wage growth rose to a 10-year high, finally hitting the level identified by policymakers as consistent with the RBA's 2-3% inflation target. (See MNI BRIEF: RBA On Track For 25bp As Wage Rises Hit Decade High)
The Australian dollar was largely unchanged after the data, with analysts suggesting the data was not enough to shift the RBA off its 25bp tightening pace. (See AUD : AUDUSD Looks Through Employment Data, Watch Fed Comments Later)