Australia's April jobs report fell short of expectations, with total employment declining by 18,600, compared to a consensus forecast of a 15,000 increase and TD Securities' own estimate of a 25,000 rise. This marks the first negative jobs print since November 2025. Full-time employment dropped by 10,700, while part-time jobs decreased by 7,900 [1]. The unemployment rate rose sharply to 4.5%, above both the consensus and prior readings of 4.3%, despite a slight decrease in the participation rate to 66.7% from 66.8% [1].
TD Securities analysts highlight that this earlier-than-expected rise in unemployment is significant, as the Reserve Bank of Australia's (RBA) Statement on Monetary Policy had only forecast a 4.6% unemployment rate beyond June 2027. The analysts note that the RBA had anticipated higher cash rates and oil price shocks would dampen aggregate demand and cool inflation, but the current jump in unemployment may come as a surprise [1].
Given the disappointing labor data and the RBA Board's previously stated preference to 'skip' a rate move in June, a pause at the upcoming June meeting now appears almost certain. However, TD Securities still sees the possibility of an August rate hike, citing ongoing inflation pressures and the importance of upcoming Consumer Price Index (CPI) data, which will be closely watched [1].
No immediate market reaction or analyst opinions beyond TD Securities' outlook were provided in the article.
CONCLUSION
Australia's weaker-than-expected April jobs report has solidified expectations for a Reserve Bank of Australia pause in June, with analysts pointing to a potential rate hike in August if inflation pressures persist. The labor market softness and unexpected rise in unemployment are key factors shaping the RBA's near-term policy outlook.