The Australian labor market has once again demonstrated unexpectedly strong performance. According to data released by the Australian Bureau of Statistics on Thursday, the unemployment rate in November fell to 3.9% from 4.1% in October, well below economists' expectations of 4.2%. Employment increased by 35,600 people, driven entirely by full-time positions, exceeding the market expectation of 25,000 people.
This performance highlights the resilience of the Australian labor market to rising interest rates. Despite multiple interest rate hikes by the Australian central bank to curb inflation, the labor market continues to expand, indicating that the economy still retains a certain growth momentum. This data has led traders to lower their bets on a rate cut in February.
Following the data release, the exchange rate of the Australian dollar against the US dollar rose to 0.6411, indicating a positive reaction from the foreign exchange market. Meanwhile, the yield on the policy-sensitive 3-year Australian government bond rose by 5 basis points, reflecting a more cautious attitude from investors regarding the possibility of further rate cuts. However, the Australian stock market failed to maintain its upward trend, surrendering all gains.
Analysts point out that despite the robust performance of the overall job market, many challenges remain for future economic prospects, especially the potential impact of a global economic slowdown and weak domestic consumption growth. Furthermore, the drop in the unemployment rate and the growth in employment may provide the Australian central bank with more policy options to consider, with the market closely watching upcoming economic data and policy statements from the central bank.
Overall, the employment data for November has further consolidated the resilience of the Australian labor market and significantly influenced the direction of monetary policy. Investors need to pay attention to data performance in the coming months to better assess the prospects for the Australian economy and interest rates.
