The Australian economy has recorded its sixteenth consecutive month of employment gains. The run of monthly consecutive gains has exceeded the fourteen month stretch from August 1979 to September 1980 and the fifteen month stretch from May 1993 to July 1994.
The ABS released employment estimates for January which indicate the total number of people employed in Australia in either full-time or part-time work increased by 16,000. Market expectations prior to the report’s release were for 15,000 new positions.
Financial markets reacted by sending yields and the AUD higher. Local 3-year and 10-year bond yields had started the day higher on the back of higher U.S. yields but they dropped upon release of the employment figures. However, within 30 minutes, yields bounced and 3-year bond yields finished the day 3bps higher at 2.16% while 10-year bond yields jumped 7bps to finish at 2.92%. The AUD also initially dropped against the USD but it quickly recovered to finish at 79.45 U.S. cents.
The participation rate fell back from a revised figure of 65.7% in December to a near-record 65.6% as an additional 8,100 people entered the labour market. While total employment increased, the total number of unemployed shrank by 7,900 and the unemployment rate fell from an upwardly-revised December figure of 5.6% to 5.5%.