Aussie unemployment supports rate hike, higher tension in Middle East
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Why is Australia’s steady 4.1% unemployment rate fueling expectations of an RBA rate hike in May?
Australia's unemployment rate kept steady last month, making that May hike seem that little bit more likely from the RBA. Plus, oil shoots up more today as more military hardware arrives in the Middle East. The US trade deficit widening, and it's PMI day today, so we get to compare and contrast the US, the UK, Europe, and US GDP today, which probably will show that they're doing somewhat better than most, but maybe not quite as much as many as expected. It's Friday, it's the twentieth of February twenty twenty six. It's the morning call from Nabb. Good morning. Well, oil prices are up another two percent this morning for Brent and WTI. Brent is above seventy one eighty a barrel now. US dollars of course.
The US dollar itself is up another naught point two percent to ninety seven point nine on the DXY index. And so is the Australian dollar also up up to uh seventy point five US cents. The pound has lost naught point four percent, the euro down naught point two percent as well. Shares were doing okay early in the session, in the morning session, but But uh we're now seeing the NASDAQ losing a third of one percent. Same for the S P 500 and bigger falls in Europe. The DAX is down 0.9%, the FTSE 100 down 0.6%. And here's NABS Sky Masters. Um we in Sydney. Um We've s m most of the movement is in all with uh bond yields not really moving much at all. Uh treasuries are up a little from earlier in the week, but we I mean we are still sitting around three month lows, aren't we?
I guess the hawkish tone of the FRMC minutes yesterday probably didn't help.
How are rising oil prices and increased U.S. air power in the Middle East affecting global market risk?
Yeah, good morning, Phil. Um, we can sort of dig a bit more into um data releases, etcetera, and around what's happened overnight, but just in your comment around Um, bond yields. Yeah, look, they um they did they did sort of there was a a Treasury led uh rise in yields early early in this session and that was off the back of some stronger than expected data. But That has since unwound and you've got yields sort of unchanged to to a fraction a fraction lower, lower on the day. And and I think really what's driving um that repricing is is resentiment and we can dig into that, as I said um in this in this podcast. But just going back to your comment around the um FMC meeting minutes, yeah, look I think it is um, you know, it it
is it is a bit challenging when I look at market pricing and then I then I sort of sort of read what was in the FMC minutes and and the write ups. Like in i in general the minutes were seen to be a bit more on on the hawkish the hawkish side. Um you know I think Fed Fed Fed members were um you know, suggesting that sort of downside risks to to the labour market had had moderated, um and we've seen that sort of that's sort of been supported by the um jobless claims data which came out overnight. But um yeah, well while the oh wait Pricing for the Fed has eased back a little bit. Um, you know, the market is the market is still pricing in the risks of of three rate cuts by the Fed this year. So pricing in, you know, fully pricing in in two twenty five base point rate cuts.
Um so I think that's sort of a little bit on the optimistic side given given the data flow that's been that's been coming in.
Well you mentioned the jobless claims, let's have a look at those 'cause they were down a lot last week, weren't they? Twenty three thousand fewer claims. So at two hundred and six thousand that is lower than the average for last year. So that is very different to what we've been seeing over the pr the previous few weeks. So it can't be used clearly as evidence that there's a weakening labour market.
What do the latest U.S. job‑less claims and payroll data reveal about the strength of the American labour market?
No, you can't. So, um as you said, it did it did come back a little bit in the week t um ending the um February the fourteenth. And I think, you know, um what what the suggestion is now is is that the drop in claims that we've seen suggests that the the recent rise was really due to sort of the the snowstorms or or or bad weather rather than s suggesting that there was some fundamental weakness going on um in the US in the US labour market.
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Chapters
8 chapters
1
Why is Australia’s steady 4.1% unemployment rate fueling expectations of an RBA rate hike in May?
0:01–1:28
2
How are rising oil prices and increased U.S. air power in the Middle East affecting global market risk?
1:28–3:32
3
What do the latest U.S. job‑less claims and payroll data reveal about the strength of the American labour market?
3:32–6:00
4
Why did Australia’s January unemployment rate stay at 4.1% and what does the participation‑rate dip mean for future job growth?
6:00–8:03
5
How is the widening U.S. trade deficit and record‑high imports influencing Q4 GDP forecasts?
8:03–10:27
6
What insights do today’s PMI releases for the U.S., Europe, UK and Germany provide about global economic momentum?
10:27–12:27
7
Why are equity markets under pressure despite strong data, and what’s the impact of Walmart’s cautious earnings outlook?
12:27–14:23
8
Is AI really threatening jobs in Australia, or are new AI‑related roles creating employment opportunities?
14:23–15:18