Newly released employment figures, which showed an increase in the number of people at work in October, have raised the chances of another interest rate hike by the Reserve Bank of Australia (RBA) before the end of the year.
According to figures from the Australian Bureau of Statistics (ABS), employment rose by 24,500 in October. Part-time jobs rose by 21,500 while full-time jobs rose by 2,900.
The figures translate to a 65,100 rise in the past two months - the biggest back-to-back monthly gain in nearly two years.
According to securities firm CommSec, the solid increase in employment has put another rate hike a step closer. "Last week's Reserve Bank monetary policy statement hinted at the improvement in labour market conditions," said CommSec economist Savanth Sebastian.
The firm said it was "almost certain" that the RBA will break tradition and raise rates for the third consecutive month in December as data releases over the last couple of weeks has been positive. "Keep in mind that the Reserve Bank does not hold its next meeting till February, so it may just be that the central bank raises rates in December and takes a well deserved break over Christmas," noted Sebastian.
The economist added, "The latest round of employment data highlights the underlying resilience of the domestic labour market and while the gains have been mostly in part-ti me employment, it is clearly encouraging, and suggests that full-time employment should rebound in coming months as the economic recovery gains traction."
Economy expected to grow - The Mid-Year Economic and Fiscal Outlook released yesterday forecasts lower unemployment than previously predicted and higher growth.
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