Australia: Labour market data surprised the market to downside - HSBC

According to the analysts at HSBC, today’s Australian jobs numbers surprised the market to downside, with employment falling by -6k jobs in February (market had 16k) and the unemployment rate rising to 5.9% (market had 5.7%).

Key Quotes

“Once again, the official labour force survey is not aligning very well with the other indicators of employment or the broader economy. In particular, the official survey shows much weaker jobs growth than implied by the business surveys and job advertisements, which both look positive. Given the various measurement issues in the official survey we have tended to put more weight on the other surveys of labour market conditions in recent years.”

“Nonetheless, with the official labour market numbers clearly showing that there remains spare capacity in the labour market, talk of RBA rate hikes any time soon seems premature. We see the RBA on hold in 2017 and lifting its cash rate in Q1 2018.”