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Felicity Emmett, senior economist at ANZ, notes that the Australian unemployment rate declined in February to 4.9%, its lowest rate since 2011, providing a setback for growing expectations of an interest rate cut.

Key Quotes

“Employment rose a modest 4.6k in February, following the 38.3k rise in January. Part-time jobs led the gain with a rise of 11.9k, while full-time jobs edged lower (-7.3k) after a strong rise in January (+65.6k).”

“Importantly, the unemployment rate dipped down to 4.9%, while the participation rate edged down to 65.6% (from 65.7%). The underemployment rate remained unchanged at 8.1%, while the underutilisation rate dipped to 13% – the lowest rate since 2013.”

“The leading indicators for employment remain mixed. Looking at a number of monthly indicators in aggregate, our ANZ Labour Market Indicator suggests that the unemployment rate will remain broadly flat over the next few months. If we are correct, this should keep the RBA on the sidelines.”