Business News
Surprise fall in unemployment signals economic improvement
Oct 8, 2009, 3:16 GMT
Sydney - Australia's jobless rate fell 0.1 per cent in September in a move that surprised economists and signaled a recovery in the Australian economy.
Economists had expected the September figures to show unemployment rise from 5.8 per cent to 6 per cent. The Bureau of Statistics announcement Wednesday that the jobless rate had fallen to 5.7 per cent sparked a sudden rise on the stock market and a rise in the Australian dollar.
The good news came two days after Australia's Reserve Bank raised interest rates to damp down the rate of economic recovery.
The Australian dollar smashed through the 90-US-cent mark on the news, to its highest level since early August 2008.
Melbourne Institute economist Edda Claus told The Age newspaper the jump in employment was a surprise and showed the economy was growing. 'This looks like it's recovering faster than expected,' she said.
'It's good news because [it's] all driven by employment growth,' Claus said. 'I think it was pretty clear Australia was recovering [before the Reserve Bank raised rates]. The issue was how fast.'
Investment bank Credit Suisse said 97 per cent of its investors were now backing another 25 basis point rate rise next month, and the Reserve Bank's official cash rate was expected to hit 5 per cent a year from now.
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