Australia’s 10-year government bond yield climbed to around 4.96%, nearing its highest level since July 2011, as investors assessed the latest labour market data. The unemployment rate unexpectedly rose to 4.3% in February, slightly above both January’s 4.1% reading and market forecasts. Nonetheless, it remains low by historical standards. Sean Crick, head of labour statistics at the ABS, noted that the increase partly reflects fewer unemployed people finding work than is typical for this time of year.
At the same time, the economy added nearly 49,000 jobs, far exceeding the projected 20,000 gain and reinforcing the Reserve Bank of Australia’s view that the economy is still resilient enough to absorb tighter monetary policy. The data came on the heels of back-to-back interest rate hikes by the RBA earlier in the week, as the central bank continues to combat stubborn inflation. Upward pressure on prices is being compounded by higher energy costs, linked to the escalating conflict involving Iran.
