Australia’s labour market demonstrated continued strength in January, according to Betashares chief economist David Bassanese. Following a robust increase in employment during December, the latest figures confirm the labour market’s sustained health. Bassanese also noted that the unemployment rate remained steady at 4.1 per cent for the second consecutive month, following a notable drop from 4.3 per cent in November. Betashares is an Australian investment management firm offering a range of exchange-traded funds (ETFs). The firm focuses on providing investors with access to diverse investment strategies.
“The ongoing strength in the labour market data is consistent with a modest strengthening in a range of hiring indicators late last year,” Bassanese stated. He added that the Reserve Bank of Australia (RBA) will likely maintain its focus on upcoming inflation data, as the labour market has not shown signs of weakening as anticipated.
Bassanese suggests that the RBA’s forecast of a relatively strong quarterly increase in trimmed mean inflation of 0.9 per cent in the March quarter indicates a potential need for another cash rate rise at the May meeting.
According to Bassanese, a significant decline in inflation would be the only relief for mortgage holders. He noted that this is possible if last year’s price gains were driven more by one-off factors than by underlying demand pressures.
