Australia: Weak employment data to underscore risks of a July RBA rate cut - NAB

Analysts at National Australia Bank (NAB) offer their expectations on Thursday’s Australian labor market report and its implications for the Reserve Bank of Australia (RBA).

Key Quotes:

“Thursday's labor market data are key for financial markets given the RBA's repeated emphasis on the importance of the unemployment rate for near-term policy.

NAB is forecasting a strong report given the employment boost from temporary workers hired to run the federal election. We expect employment grew by 40k and the unemployment rate ticked down to 5.1% in May.

If we are wrong and unemployment increases again, then the market would price in the risk of a July rate cut.”