Australian employment rose only modestly in June while the unemployment rate ticked up to 5.8 percent, yet a sharp jump in full-time jobs was welcomed by investors who nudged the local dollar higher. Thursday's data from the Australian Bureau of Statistics showed 7,900 net new jobs were created in June, after a 19,200 gain the month before. Full-time employment impressed with an increase of 38,400 as such positions tend to pay much better than temporary work.
Median forecasts had been for a rise of 10,000 jobs, though there had been a risk a statistical quirk in the survey would produce a sizeable fall in the month. The unemployment rate edged up a tick to 5.8 percent from 5.7 percent, but remains considerably lower than policy makers had forecasted at the start of the year.
Investors pushed the local dollar up a quarter of a US cent to $0.7628 after the data, though the figures were not considered so strong as to lessen the chance of a cut in interest rates in coming months. The Reserve Bank of Australia (RBA) has kept rates at a record low of 1.75 percent since cutting in May, but has signalled it was watching coming data to decide if policy needed to be eased further.
Crucial will be the consumer price index (CPI) for the second quarter due late in July, where another low reading would greatly add to the case for a move in August. "We know that inflation is so low and wage growth is so weak that if we get another quite weak CPI, then that would be the trigger for another rate cut," said Gareth Aird, a senior economist at Commonwealth Bank. Analysts consider the jobless rate a better barometer of trends in the labour market when compared to the volatile employment series.