Australian share prices face an uncertain week ahead as investors fret on key employment data which could impact on domestic interest rates, dealers said Friday.
CommSec equities economist Andrew Mitchell said the Reserve Bank of Australia (RBA) was concerned about the tight labour market in Australia when it hiked interest rates by 25 basis points to 5.75 percent in May - the first monetary tightening since a similar move in March 2005.
Data released in June showed the unemployment rate dipped below 5.0 percent in May to 4.9 percent, the lowest rate in over 30 years.
At the time, analysts warned that if the jobless rate continued to fall, the central bank could be forced to raise interest rates to curb inflationary pressure in the economy.
However, Mitchell forecast the RBA would choose to wait at least until September before it even considered to hike rates again.
"The RBA needs to sit on the interest rate sidelines a bit longer to get a better handle on what effect the interest rate hike with soaring gasoline prices and the tax cuts are having on the Australian economy," Mitchell said.
For the week ending July 7, the benchmark S and P/ASX 200 gained 61.4 points, or 1.2 percent, to 5,135.3.
CMC markets dealer Ken Cheung said the Australian market was also lacking direction ahead of the data with few leads on offer from the United States.
"The US is not giving us much direction."
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