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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
Q2 saw another very weak productivity reading driven by a strong pick up in hours worked, which rose 2.5% q/q. Productivity fell 2% q/q, the third straight quarterly drop, to be down 3.5% y/y after -0.4% q/q and -4.6% y/y in Q1. Base effects were always likely to result in an improvement in the annual rate. As a result unit labour costs (ULC) remained elevated rising 1.6% q/q to 7.5% y/y, which is likely to continue concerning the RBA.
- If hours worked are unchanged by the end of 2023, then the RBA’s desired 1% y/y productivity growth can be achieved by mid-2024 but if they stay stronger for longer then it won’t be until the end of the year. Both scenarios have ULC growth above 5% y/y until Q2 2024. These scenarios use the RBA’s WPI and GDP forecasts.
- Real unit labour costs rose 3.2% q/q and 5.9% y/y, signalling a sharp deterioration in competitiveness. Excluding Covid, this was the highest quarterly increase since the series began in 1985.
Australia productivity scenarios y/y%
Source: MNI - Market News/ABS/RBA
Australia unit labour costs 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.
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