What happened
Australia's unemployment rate reached a five-year high of 4.7% in September, exceeding market forecasts of 4.6%. Total employment contracted by nearly 40,000 jobs during the month. The jobless figure now sits above the Reserve Bank of Australia's December quarter target of 4.5%. The cash rate remains at 4.6% as markets evaluate the likelihood of a policy adjustment at the upcoming November meeting.
Why it matters here
The weakening labour market aligns with the central bank's objective to cool economic activity and curb sticky inflation. Lower employment growth reduces the immediate probability of another cash rate hike on Melbourne Cup day, offering relief to variable-rate mortgage holders. However, if inflation figures remain elevated despite rising joblessness, the RBA may be forced to keep interest rates higher for longer.
What to watch
Public addresses by RBA Assistant Governor Chris Kent and Deputy Governor Andrew Hauser this week for policy guidance ahead of the November interest rate decision.
Source
au.finance.yahoo.com