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UPDATE 1-Australian jobs dip in Sept, car sales hit record
October 15, 2015 / 2:05 AM / 2 years ago

UPDATE 1-Australian jobs dip in Sept, car sales hit record

* Employment -5,100 in Sept, misses forecasts +5,000

* Jobless rate stays at 6.2 pct, vs 6.3 pct expected

* New car sales surge to all-time highs in Sept

* Mixed reports leaves outlook for rate cut clouded

By Wayne Cole

SYDNEY, Oct 15 (Reuters) - Australian jobs took a slight slip in September after a run of strong results but unemployment held steady at 6.2 percent in a mixed report that did nothing to clarify the outlook for another cut in interest rates.

Thursday’s data from the Australian Bureau of Statistics also showed sales of new vehicles jumped 5.5 percent in September to break 100,000 for the first time ever in a hopeful sign that consumer demand and confidence were on the mend.

In all, 5,100 jobs were lost in September, a modest miss from forecasts of a 5,000 rise. The previous month was revised up to show an increase of 18,000.

The jobless rate also surprised by holding at 6.2 percent, when analysts had looked for a rise to 6.3 percent. It has stayed between 6.0 and 6.4 percent for no less than 16 months now in an unusually protracted period of stability.

Markets were barely ruffled by the data and the local dollar held firm at $0.7325 having risen overnight as soft U.S. indicators dragged on the U.S. currency.

Odds on another cut in interest rates from the Reserve Bank of Australia (RBA) actually widened a touch. Interbank futures <0#YIB:> implying a one-in-five chance of an easing in the 2.0 percent cash rate at the next policy meeting on Nov. 3.

Investors are still wagering heavily on a move by February in part due a surprise decision by Westpac this week to raise its variable mortgage rates.

Despite September dip in employment, the labour market remains surprisingly resilient compared to the overall economy.

Annual jobs growth of 2.0 percent matches that of the United States, but Australia’s workforce has been expanding faster so keeping the unemployment rate higher.

While a strong 230,100 net new jobs were created in the year to September, the labour force rose by 237,700.

Scott Haslem, an economist at UBS, also noted hours worked hit their highest in four years in September.

“All these better trends reflect rebalancing toward more labour intensive non-mining sectors, especially services,” he said. “There’s little here to suggest the economy needs a lower cash rate.”

Leading indicators of labour demand have also taken a notable turn higher recently with official and survey measures of vacancies at their highest in around three years.

Just this week a survey of businesses by NAB showed hiring intentions at their highest in four years. A separate survey of consumers from Westpac found the fear of unemployment had fallen to its lowest since 2011.

“There has been a very significant improvement in how respondents assess the labour market including job prospects for those out of work and job security for those in work,” said Westpac chief economist, Bill Evans.

“Westpac has been firmly of the view that rates will remain on hold for the remainder of 2015 and 2016,” he added. “Improving conditions in the labour market are very important from this perspective.” (Reporting by Wayne Cole; Editing by Eric Meijer)

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