Historic milestone scuppers chance of early rates cut

An unexpectedly low unemployment rate has seen 10 million Australians have a full-time job for the first time in history, likely scuppering any chance of a pre-Christmas interest rate cut.

New data from the Australian Bureau of Statistics showed the jobless rate last month was unchanged from August at 4.1 per cent, after 64,000 new jobs were created in September.

The ABS had originally put the August rate at 4.2 per cent, only to revise it down 0.1 per cent today.

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The figures are slightly better than market forecasts, with economists generally expecting it to stay at 4.2 per cent or rise to 4.3.

According to the data, about 10.03 million Australians have full-time work – the first time the 10 million milestone has ever been passed.

"With employment rising by around 64,000 people and the number of unemployed falling around 9000, the unemployment rate remained at 4.1 per cent, where it has generally been over the past six months," ABS head of labour statistics Bjorn Jarvis said.

"While the number of unemployed people fell slightly to 616,000 in September, overall the number of unemployed people has risen by around 90,000 people since September 2023.

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"Despite this rise over the last year, there are still around 93,000 fewer unemployed people than there were just before the start of the COVID-19 pandemic, when the unemployment rate was at 5.2 per cent."

The better-than-expected jobs figures are likely to end any chance of a early interest rate cut from the RBA.

Minutes from the Reserve Bank's latest board meeting acknowledged the cash rate could be dropped from its current level of 4.35 per cent if the unemployment rate jumped beyond expectations.

The central bank has previously forecasted that the jobless will rise to 4.3 per cent by the December quarter.