AUSTRALIA DATA: Data Show Little Change In Q1 Labour Market Conditions
Apr-17 02:42
While the employment numbers have been volatile in Q1 due to an increase in the number of retirees, other labour data, including underutilisation, are showing that the labour market remained tight over the quarter with steady conditions. The RBA is unsure how tight the labour market is given that price and wage inflation is moderating and thus this data will continue to be watched closely.
- While to one decimal place, the unemployment rate rose 0.1pp to 4.1%, looking deeper it was almost unchanged at 4.05% after 4.04% in February, which was revised down only 0.01pp. On average Q1 was up 0.06pp to 4.07%. The number of unemployed rose 3k in March and 12.6k in Q1 after falling 11.7k in Q4.
Australia unemployment rate %
Source: MNI - Market News/ABS
- Employment rose 32.2k in March after falling a downwardly-revised 57.5k, but over 12 months it was 308k higher and +2.2% y/y, above the series average pre-pandemic. 88% of the increase in the labour force over that time found work.
Australia employment vs labour force y/y%
Source: MNI - Market News/ABS
- The participation rate was steady in March at 66.76% after 66.75%, both are 0.5pp below January implying that the fall in the number of older people returning to work in February was sustained.
- One tentative sign of a slight easing in labour conditions is both the annual and 3-month growth in part-time (PT) employment exceeding full-time (FT). In March both were higher with PT +17.2k and FT +15k resulting in growth of 3.3% y/y & 0.7% 3m/3m saar and 1.6% y/y & 0.7% 3m/3m saar respectively.
- Hours worked fell 0.3% m/m but the ABS noted that there was a “higher than usual number of people reported working reduced hours this month due to bad weather, coinciding with ex-Tropical Cyclone Alfred”. The decline was concentrated in FT falling 0.5% m/m, third consecutive decline, while PT rose 0.7%.
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CHINA: Bond Futures Rally After Three Down Days.
Mar-18 02:40
- After three days of losses, China bond futures are posting gains in the morning session.
- Opening the day at 107.14 the 10YR future is up +.12 to 107.26.
- The 10YR future has traded below the 200-day EMA for several days, following three days of losses.
- The 2YR future is up +0.09 to 102.424 following a volatile period.
- The 2YR future has been trading below all major technical levels for several trading days but today’s move sees it approach towards the 20-day EMA of 102.49.
- Yesterday saw the CGB 10YR close just below 1.90% at 1.896%, but today’s move has seen yields lower by -1.5bps.
- The CBG 2 YR has been drifting modestly higher over the last week and is at 1.56%
AUSSIE BONDS: Little Changed, RBA Hunter: Both Fwd Looking & Data Dependent
Mar-18 02:34
ACGBs (YM -1.0 & XM +1.0) are little changed.
- Assistant Governor (Economic) Hunter spoke at the AFR banking summit about how monetary policy can be both forward-looking and data dependent given decisions are always made under uncertainty. The bank looks at the signal from data excluding the noise and uses that in determining its outlook which is then analysed under various scenarios and judgments. In February, the focus was on the impact of US policy and scenario analysis was an important part of this assessment.
- “The links between data, forecast and policy sit at the heart of us saying that policy is ‘data dependent’.” Hunter said that during times of “heightened uncertainty”, there is more weight put on “real time data” relative to forecasts.
- Cash US tsys are ~1bp richer in today’s Asia-Pac session. The focus is on Wednesday’s FOMC decision.
- Cash ACGBs are 1bp cheaper to 1bp richer with a flattening curve. The AU-US 10-year yield differential is at 11bps.
- Swap rates are 2bps higher to 1bp lower, with the 3s10s curve flatter.
- The bills strip is -1 to -3.
- RBA-dated OIS pricing is flat to 2bps firmer across meetings today.
- The highlight of the week is likely to be Thursday’s jobs data for February.
ASIA STOCKS: Korea Enjoys Second Day of Big Inflows.
Mar-18 02:27
South Korea has recorded another day of solid inflows whilst outflows dominated elsewhere.
- South Korea: Recorded inflows of +$346m yesterday, bringing the 5-day total to -$858m. 2025 to date flows are -$5,203m. The 5-day average is -$172m, the 20-day average is -$192m and the 100-day average of -$119m.
- Taiwan: Had outflows of -$303m yesterday, with total outflows of -$3,266 m over the past 5 days. YTD flows are negative at -$14,010m. The 5-day average is -$653m, the 20-day average of -$548m and the 100-day average of -$197m.
- India: Saw outflows of -$98m as of the 13th, with a total outflow of -$702m over the previous 5 days. YTD outflows stand at -$15,932m. The 5-day average is -$140m, the 20-day average of -$294m and the 100-day average of -$201m.
- Indonesia: Posted outflows of -$54m yesterday, bringing the 5-day total to -$228m. YTD flows are negative at -$1,648m. The 5-day average is -$46m, the 20-day average is -$53m the 100-day average of -$33m.
- Thailand: Recorded outflows of -$39m yesterday, totaling -$188m over the past 5 days. YTD flows are negative at -$942m. The 5-day average is -$38m, the 20-day average of -$40m the 100-day average of -$19m.
- Malaysia: Experienced outflows of -$64m Friday, contributing to a 5-day outflow of -$303m. YTD flows stand at -$1,699m. The 5-day average is -$61m, the 20-day average of -$46m the 100-day average of -$33m.
- Philippines: Saw inflows of +$6m yesterday, with net inflows of +$14m over the past 5 days. YTD flows are negative at -$213m. The 5-day average is +$3m, the 20-day average of -$3m the 100-day average of -$7m.
