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Markets weigh stronger jobs data and renewed Middle East tensions

Australian employment rose 76.3k in June, but the participation rate jumped 0.3 percentage points to 67.0%, keeping unemployment at 4.4% and raising signals of slack building.

Reported · Written up by our desk · Central Banks

Markets were on edge as the June Labour Force Survey showed an employment gain, with employment rising 76.3k, but the increase came alongside a lift in labour supply. The participation rate bounced 0.3 percentage points to 67.0, a 13-month high, helping leave the unemployment rate steady at 4.4%. The report noted that a group of people reported as being outside the labour force had job starts lined up in May, then began work in June. With the unemployment rate holding, the outlet said rising unemployment and a sharp lift in underemployment over recent months suggest labour market slack is building, even as employment growth looks steadier over the first half of the year.

The outlook focus also shifted to cost pressures and employment sentiment, with the Q2 Westpac Business Signal pointing to growing costs and greater exposure in consumer-facing industries. The brief added that weaker employment intentions in other business surveys point to a sluggish employment outlook into the end of the year, with expectations for unemployment to peak around 5.0%. Offshore, Middle East tensions remained a key driver, after President Trump said he was close to deciding on a “massive attack” against Iran and threatened “major military punishment” for the Houthis. Brent oil traded near USD102, and fresh market attention turned to potential implications of a planned 10% to 12.5% US tariff on 99% of imports effective 12:01am Friday Washington time, according to Action Forex.

Latest closeBrent $100.54 ▲6.9%

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