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Already jubilant on the back of NVIDIA’s overnight earnings (and dividend boost), as well as fresh claims from Trump the Iran war could be ending, knocking US$5/bbl off the Brent Crude price – we’ve had yet another point of optimism on Thursday.
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That came from the Australian Bureau of Statistics (ABS), which today released its latest domestic unemployment figures – revealing the Australian unemployment rate has jumped up to 4.5% on a seasonally adjusted basis.
This comes as an apparent surprise to RBA projections, which recently posited that unemployment would be at 4.2% by the time we get to June CY26.
While we’re yet to see the rate continue to climb (or hold flat at 4.5%), the news has been enough to leave some investors hopeful the news could spell a shorter lifespan for Australia’s elevated interest rate environment.
For those who need reminding – it’s been a while since I’ve written about employment data! – the dual mandate of the RBA is to maintain inflation and keep an eye on the labour market. Interest rate hikes are meant to strangle the economy, and if the unemployment rate climbs too high, then it’s the RBA’s job to bring interest rates back down.
That’s the bull thesis behind the behaviour pushing the market higher on Thursday in the first half-hour following the data drop.
Behind the rise to a 4.5% headline rate is the shifting number of employed persons versus the unemployed. The number of people looking for full-time work increased by 11,000 in April, while unemployed people looking for part-time work rose by 22,000.
“The number of employed people fell by 19K in April, while the number of unemployed people rose by 33,000 [while] both full-time and part-time employment fell, by 11,000 and 8,000 people respectively,” ABS statistics chief Sean Crick summarised.
Perhaps what the market’s paying most attention to is that more people remained unemployed through April 2026 than is normal for April in previous years.
But talking about previous years, one also needs to address the fact that compared to historical pre-COVID trends, an unemployment rate of 4.5% still reflects a tight jobs market.
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