Fed: Jobs growth keeps up expectations of rate hike

AAP General News (Australia)
12-12-2003
Fed: Jobs growth keeps up expectations of rate hike

CANBERRA, Dec 12 AAP - Australians have been urged to jump into a bountiful job market
as new employment figures kept up expectations of a further hike in interest rates.

Treasurer Peter Costello said jobseekers should make the most of the best employment
opportunities in more than 20 years as the November jobless rate remained at a 14 year
low of 5.6 per cent.

Over the month, more than 20,000 new full-time jobs were created.

Businesses have hired almost 208,000 new staff in the last year, more than half of
them in the last four months as the economy recovered from a soft patch and consumer confidence
hit record highs.

The jobless rate is at its lowest since 1989 and just two steps away from the record
low of 5.4 per cent in 1981, after dipping below six per cent for the first time in 13
years three months ago.

Treasurer Peter Costello said jobseekers should take advantage of the good conditions.

The jobs gain was higher than economists predicted, and raised expectations of strong
economic growth in the last quarter of the year along with further interest rate rises
to come.

The Reserve Bank has already warned of a shortage of workers in some areas, which could
put pressure on wages and therefore inflation and interest rates.

Interest rates have been hiked twice in the last two months but homebuyers now have
a two month breather until the central bank board meets again in February.

HSBC senior economist Anthony Thompson said he expected rates to rise by another 0.5
percentage points by the middle of next year.

AAP so/cjh/de

KEYWORD: ECONOMY DAYLEAD

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