Analysts at TD Securities note that the Australia’s May employment jumped as they expected due to a temporary election bounce (May 18).
“Employment rose by +42.3k (nearly all part-time at +40k) and the prior month was upgraded from +28k to +43k. We did not anticipate the jump in the participation rate to a record high 66%, hence the u-rate remained at 5.2% (well over time-varying NAIRU estimates according to the RBA yesterday).”
“There is enough noise in the report not to support expectations for a July cut, but wait and see what the June report brings (our flash f/c is 5.1). We look for an August cut to 1%.”