Annette Beacher, Chief Asia-Pacific Macro Strategist at TD Securities, points out that the Australian employment surged by +32.8k in Oct (TD +25k, mkt +20k).
Key Quotes
“A strong report driven by full-time (+42.3k) and a pickup in the part rate to 65.6%. The u-rate remained at a 6yr low of 5%.”
“Seasonals suggest decent jobs growth into year end, so we look for +35k and +30k for Nov/Dec, lowering the u-rate to 4.9% by Dec-2018.”
“RBA expects the u-rate to remain at 5% over 2019, dipping to 4 ¾% over 2020. Missing is the commensurate acceleration in wage inflation, hence why the cash rate remains at 1.5% until Nov-2019.”
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