MNI DATA ANALYSIS:Australia Job Ads Trend Lowest Since Feb '16

--ANZ Job Ads -1.7% M/M in June; Down For 4 Months Out of 5

By Sophia Rodrigues

     SYDNEY (MNI) - Job advertisements in Australia fell in June to the lowest

level this year, posing risk to the unemployment rate outlook and for the

Reserve Bank of Australia's monetary policy stance.

     Data published by ANZ Monday showed jobs ads fell 1.7% m/m in June,

following a downwardly revised 1.4% rise in May.  

     The decline led to a sharp slowing in y/y pace to +6.9% from +11.5% in May,

and to the lowest pace since December 2016. In trend terms, job ads slowed to

just 0.1% m/m growth pace in May and June, the lowest since February 2016.

     In actual terms, job ads were at 175,660, the lowest level this year. While

this still points to a decline the jobless rate, ANZ's head of Australian

economics David Plank has warned that further weakness would be a worrying

development.

     "Further weakness in ANZ Job Ads over the next few months would be of

significant concern and would potentially point to a lift in the unemployment

rate," Plan said, adding, "We are some way from that point, however, not least

because other indicators, such as business conditions, consumer sentiment and

ABS job vacancies imply a positive outlook for employment."

     The outlook for the labor market is extremely important for the RBA's

monetary policy because Governor Philip Lowe has indicated that as long as the

labor market is improving, he wouldn't worry too much about low inflation.

     "My view has been that the welfare maximising approach, which is really

what we're about, maximising the welfare of the people, is to be patient (on

inflation) as long as the labor market is improving," Lowe said in a speech at a

recent ECB conference.

     From the ANZ job advertisement survey for June:

                              June                         May

--------------------------------------------------------------

Job Ads (SA*, Change M/M)     -1.7  +1.4% (revised from +1.5%)

Job Ads (SA*, Change Y/Y)    +6.9%                      +11.5%

Job Ads (Trend, Change M/M)  +0.1%  +0.1% (revised from +0.4%)

Job Ads (Trend, Change Y/Y)  +8.2%                       +9.3%

--MNI Sydney Bureau; tel: +61 2-9716-5467; email: sophia.rodrigues@marketnews.com

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