The highlight last week was the bounce in employment in February. Employment rose a sharp 47,300 in the month (with full-time employment up a huge 88,000) and the fall in January was revised to become a solid 18,000 rise. While the unemployment rate remained unchanged at 6.0%, the long-awaited lift in jobs growth provides further evidence that the labour market is turning around.
While there was some scepticism about the accuracy of the full-time employment number (statistical error), the combined effect of the unemployment rate being unchanged at 6% and the fact that employment had been strong supported market sentiment last week. This is despite poor Chinese data and subsequent growth jitters. Add in renewed tension in the Ukrainian-Russian standoff, which saw offshore markets switch into risk-averse mode causing bonds to rally and stock markets to sell off.
State elections were held in both South Australia and Tasmania last Saturday. Tasmania decisively voted in a Liberal government however the result was less clear in the South Australian election with neither major party winning enough seats to form a majority government – although almost 200,000 postal votes are yet to be counted. It looks as if the two parties will negotiate with the two independent MPs, who appear certain to hold the balance of power (and who are in no rush to decide who they will support), to determine which side will form a minority government. Plus, we could therefore see the Commonwealth and all states and territories except for the ACT governed by the Liberal and National parties in Australia.