The latest update of Australian labour market conditions is due today (1130 AEST). A modest rise in employment of 15k is expected to hold the unemployment rate steady at 4.4% in June. Market pricing places only around a 20% chance of an RBA rate hike in August, rising to around 75% by year-end. If there is to be a hawkish revamp of those expectations, next week's key quarterly inflation data is far more likely to be the catalyst than today's report.
June preview: Steady as it goes
Expectations for employment have dropped back to a 15k rise in June - roughly half the gain forecast last time out - though the band of estimates covers a significant range (0-50k). The higher consensus figure for May was driven by expectations for a seasonal rebound in employment after Easter. The unemployment rate is forecast to print at an unchanged 4.4% (range: 4.3-4.5%).
May recap: Employment surges drives unemployment rate down
Employment posted its strongest increase of 2026 rising by 40.3k in May - but only after falling by 40.7k in April amid the Easter holiday period. That saw the unemployment rate fall back to 4.4% after it rose to 4.5% in April, its equal highest since late 2021, while labour force participation lifted to 66.7% from 66.6%. Hours worked were again the surprising aspect, falling 1.1% in May despite the sharp increase in employment, reversing its 0.9% rise in April when employment fell.
May's increase in employment was heavily weighted towards the part time segment (35.2k), though full time also contributed (5.2k). While recent outcomes have been volatile, employment has largely been in a holding pattern. Employment gains are averaging around 15k per month this year and only around 6k for the past three months.
