David Gray | Reuters
A woman holds an umbrella as a cyclist rides nearby on a rainy day in the central business district (CBD) of Sydney, Australia, March 7, 2017.
Australia‘s jobless rate climbed to a 13-month high in February and employment unexpectedly fell, a risk to the outlook for wage growth and inflation that will likely keep open the possibility of another interest rate cut.
The Australian dollar slipped more than a quarter of a U.S. cent on the disappointing report to A$0.7689 from a three-week peak of $0.7720.
The jobless rate rose to 5.9 percent, compared with analysts’ expectations for a steady 5.7 percent, data from the Australian Bureau of Statistics showed on Thursday.
Employment dropped 6,400 in February, also upsetting forecasts of an increase of 16,000.
The decline was led by a 33,500 hit to part-time work even as the number of full-time jobs rose 27,100 in the month.
Since February last year, part-time employment has climbed by 127,800 while full-time has slipped by 23,100, pointing to lingering slack in the economy.
“As such, the labor market is unlikely to generate much inflationary pressure for the foreseeable future,” said Paul Dales, chief economist at Capital Economics.
“If the unemployment rate were to rise sharply, this could be enough to prompt a further rate cut by the RBA.”
