Here comes the oil tanker:
Australia’s growth rate still stands at 0.9 percent for the June quarter while CPI inflation remains at 2.1%, inside the Reserve Bank of Australia’s official target band of 2-3%. The official unemployment rate fell to 5%. The RBA Shadow Board rules out any likelihood that a reduction in interest rates could be called for. It attaches a 53% probability that holding interest rates steady at 1.5% is the appropriate setting, while the confidence in a required rate hike equals 47%.
According to the ABS, the seasonally adjusted unemployment rate in Australia fell 0.3 percentage points in the past month, to 5%. However, net employment increased by a mere 5,600 (compared to 44,000 in the previous month), implying that it was the significant reduction in the labour force participation rate, from 65.7% to 65.4%, responsible for generating the drop in the unemployment rate. New data on real wage growth, which has been worryingly subdued for several years now and is thus closely watched by economists, will not be released until the middle of November.
