Australia’s unemployment rate has unexpectedly fallen to 3.9% in November, according to the latest data from the Australian Bureau of Statistics. This decline surpasses the anticipated rise to 4.2%, marking the lowest unemployment rate since March. Approximately 36,000 individuals secured jobs last month, which is positive news for those affected; however, this surprising drop may delay any potential interest rate cuts by the Reserve Bank of Australia (RBA) in February.
Economists had hoped that a reduction in unemployment could lead to a more favourable stance on interest rates, but the unexpected jobs report suggests otherwise. Sean Langcake from Oxford Economics Australia noted that the RBA is likely to maintain rates until at least May, as underlying inflation remains above target and the labour market is operating near its capacity. Consequently, the recent employment figures appear to have diminished prospects for an earlier interest rate decrease, reinforcing the central bank’s cautious approach in the current economic climate.