MNI DATA PREVIEW: Australia Jobless Rate Seen Edging Higher

By Lachlan Colquhoun

     BEIJING (MNI) - Australia's unemployment rate is expected to tick up to

5.3% in July from 5.2% in June. The rate was at a decade low of 4.9% in February

as recently as February.

     The latest data will be released Thursday by the Australian Bureau of

Statistics.

     Other points to note:

Key to monetary policy 

The Reserve Bank of Australia cut official interest rates in June and July down

to 1%, citing overcapacity in the labour market as a major reason for its

decision. In last week's Statement on Monetary Policy, the RBA forecast

unemployment to be steady at 5.2% this year, before falling to 4.9% by June

2020. The Bank has indicated it believes full employment is achieved with an

unemployment rate of 4.5%.

Employment also increasing 

Unemployment has increased as the number of people employed has increased, due

to a record high participation rate of 66.0%. More than 300,000 jobs have been

created over the last 12 months.

Underemployment still high 

The underemployment rate is now closely watched as an indicator of capacity in

the labour market. Although underemployment fell 0.4 percentage points to 8.2%

in June, when added to the unemployment rate this still means that more than 13%

of the population is either unemployed and looking for work, or would like to

work more hours.

Full time and part time 

Full-time employment increased by 21,100 in June while part-time employment fell

20,600. The RBA will be encouraged

--MNI London Bureau; tel: +44 203-586-2225; email: les.commons@marketnews.com

[TOPICS: M$A$$$,M$L$$$]