Even though the headline rate seems to be a minor slip, a closer analysis suggests a bright future for the job market in Australia. The jobless rate is still at a 50-year low.
The total shift in employment for May was 60,600, rather than the expected 25,000. In May, full-time employment climbed by 69,400, while part-time employment decreased by 8,700.
The participation percentage increased to 66.7%, up from 66.3% previously and greater than the projected 66.4%. This explains why, despite the addition of more positions, the unemployment rate has risen slightly.
The RBA has more than enough room to control detrimental inflation, according to the figures of June 16. RBA Governor Philip Lowe has stated unequivocally that strong rate hikes are on the way.
On June 14, Lowe told the Australian Broadcasting Corporation (ABC) that the Reserve Bank will do everything it takes to prevent inflation.
Lowe appears to be channeling outgoing ECB President Mario Draghi, except rather than supporting irresponsibly lax policy, he is regarding his position as a central banker as highly significant.
Lowe stated that Australians should expect rising interest rates and that it is realistic to expect the cash rate to reach 2.5% over the course of 2022, which is the median of the statutory 2-3% goal range. He predicted that inflation will reach 7% later in 2022.
The Australian government revealed on June 15 that the minimum wage will increase by 5.2 %, which is 0.1 % higher than the recent inflation figure of 5.1%. It is a welcome decision from minimum-wage workers, but it is a problem for monetary policymakers seeking to keep inflation under control.
With wages on the rise, Lowe’s message makes sense. He defended his hawkish posture by recognizing that the crisis has ended and it is time to eliminate the emergency policy measures.