Australia’s labor market took a success in February, with employment falling by 52,800. That’s worse than the anticipated 30,000 job acquire! This additionally marked a pointy reversal from January’s revised improve of 44,000 jobs.
Regardless of the drop in employment, the unemployment charge held regular at 4.1%, in keeping with expectations. Different key particulars from the report:
- Full-time jobs fell by 35,700
- Half-time employment declined by 17,000
- The participation charge slipped from January’s report 67.2% to 66.8%
- Month-to-month hours labored dropped by 0.4%
- Annual job development slowed to 1.9% from 3.5%
The composition of job losses is especially telling. In January, the economic system added over 54,000 full-time jobs whereas shedding part-time roles, signaling energy in core employment. February flipped the script, with full-time jobs bearing the brunt of losses. The decline in hours labored provides additional proof that the labor market is cooling.
Hyperlink to Australia’s Labour Power Survey (February 2025)
The shift in labor market circumstances, after a number of months of resilience, could sign that larger rates of interest are lastly having their supposed impact on cooling demand within the economic system.
Market Response
Australian Greenback vs. Main Currencies: 5-min
Overlay of AUD vs. Main Currencies Chart by TradingView
The shock drop in employment doubtless supplies the RBA with extra confidence to think about extra coverage easing within the coming months, particularly with the unemployment charge nonetheless at comparatively low ranges in comparison with historic requirements.
The Australian greenback, which had been buying and selling in ranges forward of the roles report, dropped sharply on the employment miss as merchants noticed elevated probability for RBA charge cuts.
Nevertheless, an enchancment in danger sentiment following features within the earlier US session has helped the forex get well a few of its losses, although it stays broadly weaker (besides in opposition to the New Zealand greenback).
