All signs appear to point to Australia being on track to meet the Reserve Bank of Australia’s 2-3% target for inflation following the release of labour market data today (16 January).
The unemployment rate rose 0.1 percentage point month over month to 4% in December but continues to remain within a tight range of 3.9-4.2% over the last 10 months, according to ANZ senior economist Adelaide Timbrell.
“Although the labour market remains resilient, the sharper-than-expected slowdown in wage growth in 2024 and weaker inflation forecast for Q4 suggest that an unemployment rate at or just below 4% may be consistent with underlying inflation in the target band,” she says.
“Further, our preferred measure of labour market tightness remains at levels consistent with inflation ultimately returning to the RBA’s 2-3% target band.”
Employment growth was up 56,300 in December, compared to 28,200 in November.
Australian equities continued strongly over the course of Thursday trade, with the S&P/ASX 200 surging 113.70 points, or 1.38%, to 8,327 points by the closing bell.
The index crossed above its 50-day moving average with all sectors in the green and decent gains from the real estate (2.32%), financial (2.31%) and information technology (1.56%) sectors.
Materials rose 0.95%, energy advanced 0.63% and industrials climbed 0.58%.
Over the last five days, the index is virtually unchanged, but is currently 2.20% below its 52-week high.
Among the larger players, Mineral Resources (ASX:MIN) and mining contractor Monadelphous (ASX:MND) were not among the gainers today, slipping 2.01% to $36.01 and 1.66% to $14.20, respectively.
Junior urea play Neurizer (ASX:NRZ) held onto its wins to close up 100% at $0.002, Athena Resources (ASX:AHN) shifted up 25% to $0.005 and Asara Resources (ASX:AS1) ended the session 22% higher at $0.022.
The S&P/ASX200 is Australia’s leading share market index and contains the top 200 ASX-listed companies in terms of market capitalisation, and accounts for about 80% of the country’s equity market. The index is designed to measure the performance of the 200 largest index-eligible stocks listed on the ASX by float-adjusted market capitalisation.
It is recognised as the institutional investable benchmark in the country.
Write to Angela East at Mining.com.au
Images: ASX & Stock
