Westpac said October’s stronger labour force figures largely cancel out the weaker-than-expected result seen in September, leaving the broader story of a gradually softening jobs market intact. The bank argues that the underlying trend remains one of “less tight” labour conditions rather than any meaningful shift in momentum.
The economists noted that RBA Governor Michele Bullock described the September data as containing “some signal” and “some noise,” but suggested today’s improvement gives the central bank grounds to largely dismiss that earlier weakness. Such a reaction would align with an RBA that remains chiefly concerned about persistent, above-target inflation rather than short-term volatility in employment.
With the labour market neither threatening to reignite price pressures nor deteriorating sharply enough to raise alarm, Westpac expects the RBA to stay focused on the sequence of inflation prints. Policymakers will be looking for clearer evidence that underlying inflation is on track to ease toward the midpoint of the target band over the year ahead, the bank said.
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The bank’s assessment reinforces expectations that the RBA will remain on hold, with labour-market conditions neither driving inflation higher nor signalling economic stress. Focus stays on upcoming CPI prints as the key determinant of policy direction.
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Earlier:
