Australian employment posted a disappointingly small rise in September in a hint that a very tight labour market might finally be loosening, lessening pressure for faster increases in interest rates.
Figures from the Australian Bureau of Statistics on Thursday showed net employment rose just 900 in September, short of market forecasts of 25,000 and well down on August's jump of 36,300. Hours worked were also flat, suggesting some cooling in activity.
The jobless rate held near 48-year lows at 3.5% in September, while the participation was just off record highs at 66.6%. This is a major reason why markets fully expect another rate rise of 25 basis points in November. Rates are tipped to reach as high as 4.25% by the middle of next year, in part because the U.S. Federal Reserve looks set to tighten policy drastically.
The central bank's patience could be tested next week when figures for third-quarter consumer prices are released and are likely to show annual inflation running at a 32-year high around 7.0%.
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