Citi discusses its reaction to this week's weak patch of Australian employment data.
"Australia’s unemployment rate rose back to 5.3% and the employment change number came in at 19k with most of the change being seen in full time employment (-10.3k)," Citi notes.
"Despite the poor data, our economists note that the RBA is unlikely to be spooked. - “We don’t believe today’s data will result in an RBA interest rate cut next month. Rather, we believe the RBA will give more time for the cuts to date and tax rebates to influence activity data, particularly as the RBA believes the economy is at a gentle turning point. Today’s data will however guarantee that the RBA maintains the dovish policy bias.” - Note that the RBA Board meeting will be on 3 December and this was the last major data release before then -
"The economic outlook is that “we continue to expect the next live RBA meeting to be in February 2020, by which time we expect the RBA Board to conclude that further policy stimulus is required and where we forecast the final 25bp rate cut of this cycle.” Citi adds.