Free Trial
Why MNI
MNI is the leading provider
of intelligence and analysis on the Global Fixed Income, Foreign Exchange and Energy markets. We use an innovative combination of real-time analysis, deep fundamental research and journalism to provide unique and actionable insights for traders and investors. Our "All signal, no noise" approach drives an intelligence service that is succinct and timely, which is highly regarded by our time constrained client base.Our Head Office is in London with offices in Chicago, Washington and Beijing, as well as an on the ground presence in other major financial centres across the world.
AUSTRALIA DATA
Today’s Q1 national accounts included updated data on productivity and unit labour costs (ULC), which the RBA has become increasingly concerned about and Governor Lowe noted is having a direct impact on services prices. Productivity fell another 0.2% q/q to be down 4.5% y/y, the lowest annual rate since the series began in 1979. Hours worked rose 0.6% q/q to be up 7.1% y/y. ULC rose 2% q/q to be up 7.9% y/y from Q4’s 6.9% y/y, the highest annual rate since 1990 outside the pandemic. This data is only going to increase inflation risks and the RBA’s concerns.
- Total compensation of employees rose 2.4% q/q to be up 10.8% y/y, the highest annual rate since Q2 2007.
- There is a long way to go before productivity growth returns to +1%, the RBA’s forecast and desired rate. If hours worked decline to zero by Q2 2024 and using the RBA’s GDP forecasts, productivity reaches 1% in Q3 2024, and if hours worked fall to zero by Q3 2023 and stay there end-2024, this is achieved in Q1 2024. The first scenario is likely to mean more tightening, while the second one is more drastic it would be more in line with the RBA’s wish.
- Real unit labour costs rose 0.1% q/q to be up 1.1% y/y from -2% y/y in Q4, signalling that the loss of competitiveness stopped in Q1.
Australia productivity y/y% with scenarios
Source: MNI - Market News/ABS/RBA
Australia nominal vs real ULC y/y%
Source: MNI - Market News/ABS
Why MNI
MNI is the leading provider
of intelligence and analysis on the Global Fixed Income, Foreign Exchange and Energy markets. We use an innovative combination of real-time analysis, deep fundamental research and journalism to provide unique and actionable insights for traders and investors. Our "All signal, no noise" approach drives an intelligence service that is succinct and timely, which is highly regarded by our time constrained client base.Our Head Office is in London with offices in Chicago, Washington and Beijing, as well as an on the ground presence in other major financial centres across the world.
We are facing technical issues, please contact our team.
ok
Your request was sent sucessfully! Our team will contact you soon.
ok