Justin Smirk, Research Analyst at Westpac, suggests that a soft patch in Australian unemployment for early 2019 will lift it to 5.3%.
Key Quotes
“Unemployment fell to a six year low of 5% in September. If you look at the labour market holistically, the large monthly drop looks like survey volatility rather than a new lower trend (see “Australian Labour Force Survey; a robust update if you look through the volatility”). Nevertheless, it is our view that the labour market is sound and that unemployment has been trending down.”
“Westpac forecasts the unemployment rate to hold above 5% to end 2018 before a soft patch in the June quarter 2019 (due to both election uncertainties and correction to the 2017/2018 strong patch) will lift unemployment to 5.3%. Once past the soft patch, steady employment growth will take unemployment back down to 5.0% by end 2019 and 4.8% by end 2020.”
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