Australia's unemployment rate has climbed to a five-year high of 4.7% in September, surpassing economist forecasts of 4.6%. The Australian Bureau of Statistics reported a drop in employment by nearly 40,000, though this decline was milder than anticipated. The rising jobless figures have sparked speculation that the Reserve Bank of Australia (RBA) may hold interest rates steady at its next meeting on Melbourne Cup day in early November.
The RBA's governor, Michele Bullock, had previously indicated that higher unemployment would be necessary to curb inflation. With unemployment already exceeding the bank's December quarter forecast of 4.5%, the central bank's upcoming speeches will be closely scrutinized for hints about its rate decision. Assistant governor Chris Kent and deputy governor Andrew Hauser are scheduled to speak at conferences this week.
NAB economist Jessie Cameron suggested that the RBA is unlikely to raise rates further, aiming to avoid additional strain on mortgage holders. However, she noted that the risk of a hike remains. The RBA's last meeting saw the official cash rate lifted to 4.6%, its highest level in 15 years.
Meanwhile, the RBA's decision to ban credit and debit card surcharges, effective from the start of October, has sparked controversy among business owners. Westpac chief economist Luci Ellis defended the move, stating that surcharges no longer made sense in a largely cashless economy. She argued that firms would likely incorporate the fees into sticker prices, making costs more transparent for consumers.
On Wall Street, tech stocks faced renewed pressure, and oil prices surged, contributing to a sharp decline in major indices. The S&P 500 fell 1.09% to 7,659.44 points, the Nasdaq dropped 2.15% to 26,140.03 points, and the Dow Jones dipped 0.34% to 52,002.41 points. Australian share futures slipped 11 points, or 0.12%, to 17,528, while the S&P/ASX200 gained 87 points on Friday, closing at 8,806.7.