- Australia & New Zealand Banking Group
Australia's unemployment rate unexpectedly declined to the lowest level in two-and-a-half years in March, reflecting an improvement in business confidence and signalling the Reserve Bank of Australia is unlikely to ease policy in the near-term. The jobless rate dropped to 5.7% in March, according to the Australian Bureau of Statistics. A net 26,100 jobs were added to the economy in March, the biggest increase in 2016 and stronger than economists' forecast of 18,000. The stronger labour market also further evidence that record-low interest rates are boosting a revival in industries like construction, tourism and education as a resource boom winds down. Still, the outlook for business investment remains bleak and the outlook is clouded in China, Australia's biggest trading partner. In light of financial turmoil in China and growing divergence in monetary policies around the globe, Australian policy makers continue to navigate the economy to a post-mining future. A further hurdle has been a rebound in the Aussie, which surged more than 7% in March to be the best performer in a group of 10 major currencies last month.
Reports earlier this week showed a growing divergence between how businesses and consumers view the outlook for the economy. While Australian firms viewed business conditions as being at their best level since 2008 last month, Australians were less confident about the economic outlook.
© Dukascopy Bank SA