Australia's unemployment rate rose to 4.6% in August despite stronger employment growth, but solid labor-market conditions are unlikely to materially change the Reserve Bank of Australia's (RBA) rate-hike outlook, Commonwealth Bank of Australia (ASX:CBA) said in a report on Thursday.
The participation rate rose to over 67% in August as more people joined the labor force, with part-time employment increasing by 46,000, full-time jobs declining by 6,000, underemployment easing to 6.2%, and hours worked rising 0.7%, per the report.
CBA Senior Economist Ashwin Clarke said the unemployment rate was slightly above CBA and RBA expectations but was unlikely to materially change the policy discussion.
"Employment growth and other labor market indicators remain solid and there are no signs of a sharp deterioration," Clarke added.
CBA has brought forward its forecast for the next RBA rate hike from November to September, predicting a 25-basis-point increase to 4.60% at the September meeting.
"Higher oil prices, stronger economic data and recent signals from the RBA had shifted the balance towards an earlier increase," said Belinda Allen, CBA head of Australian economics.
The Australian Bureau of Statistics cautioned against placing too much weight on the August result alone after changes to its labor force survey, saying testing showed the impact was smaller than normal sampling variability and the figures remained fit for purpose.
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