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Catherine Birch, Analyst at Australia and New Zealand (ANZ) Banking Group, is out with her take on the upbeat Australian labor market report released earlier today.

Key Quotes:

“A surprisingly strong employment gain of 41.1k in June was largely due to a 34.5k rise in full-time employment.

The unemployment rate remained at 5.2% with the participation rate increasing to a fresh record high of 66.1%. However, in trend terms, unemployment snuck up to 5.3%, back to where it was a year ago. Underemployment was up 0.2ppt to 8.4%, so total underutilisation rose.

There is still too much spare capacity in the labour market but the strong headline employment result weakens the domestic case for a September rate cut.”