Australia: Peaking in employment lead indicators, but still solid – AmpGFX

According to Greg Gibbs, Analyst at Amplifying Global FX Capital, at the margin, the dip in the NAB monthly business survey employment component, flattening in job ads, and the lower trend employment growth in recent months might suggest some risk of a weaker than expected Australian employment report for June, released on Thursday.

Key Quotes

“However, in the broader context, the labour market appears robust and we cannot read too much into the modest decline in these leading indicators.”

“The NAB business survey labour component has weakened from around 12 earlier in the year to a recent low of 5 in June. However, this is still a solid result, and the drop may be noise, so we shouldn’t read too much into this.”

“On the other hand, the Australian Bureau of Statistics broader vacancy series rose strongly in the last two quarters to May; a record high.”

“Job growth has slowed this year

The pace of job growth has slowed from around 35K in the second half of last year, to around 12K in recent months.

The market is looking for a bit a rebound in the data for June on Thursday from recent low job growth outcomes; the median prediction for job gains is 16.5K. The data is notoriously hard to predict and the range of expectations is from +5K to +30K.”