The monthly Australian jobs report is scheduled for release on Thursday at 00:30 GMT, and market participants expect: moderate job growth in January. The Australian Bureau of Statistics (ABS) is expected to make an announcement 20 thousand fresh jobs per month, while the Unemployment Rate is forecast at 4.2%compared to 4.1% recorded in December. The participation rate is 66.8%, which is practically unchanged compared to the previous 66.7%.
The ABS reports both full-time and part-time positions as part of the monthly employment change. Generally, a full-time job involves working 38 or more hours per week, usually comes with benefits, and usually provides a steady income. On the other hand, part-time employment usually means a higher hourly wage but lacks consistency and benefits. This is why the economy prefers full-time work. In December, Australia gained 10.4 thousand. part-time positions and 54.8 thousand full-time.
Australia’s unemployment rate is expected to rise in January
Australian employment data is in line with the Reserve Bank of Australia’s (RBA) monetary policy decision, which slightly reduces the impact of numbersespecially given the RBA’s decision to raise the Official Cash Rate (OCR).
Officials assessed the risk of inflation, noting that they expected it to remain above target for some time. Moreover, policymakers noted that different indicators suggested this labor market conditions remain “a little” tight. As a result, the Council increased the OCR by 25 basis points to 3.85%.
Data from December confirmed this decision, with total inflation amounting to 3.8% y/y, which was influenced by, among others, persistently high service-related inflation and well above the RBA target of 2-3%. Wage growth in the final quarter of 2025 also exceeded the RBA target, with the Wage Price Index at 4.1% y/y.
RBA Governor Michele Bullock admitted the decision had a negative impact on homeowners. “I know this isn’t the news Australians with mortgages want to hear, but it is the right decision for the economy,” she said. “Based on the data we have seen and conditions here and around the world, management currently believes it will take longer for inflation to return to target, and that is not an acceptable outcome,” Bullock added.
Finally, the minutes showed that policymakers had not committed to further increases, but left the door open for additional tightening. Like most central banks around the world, the RBA has announced that decisions will be data-driven and made at each meeting.
Employment figures for January are expected to be not enough to make the RBA reconsider its fresh interest rate policyalthough this will maintain the issue of a tight labor market. However, higher-than-expected job growth could fuel expectations of additional interest rate increases and boost demand for the Australian dollar (AUD). The reverse is also true, with a milder-than-expected result pushing the Australian down along with the chances of additional increases.
When will the Australian jobs report be released and what impact might it have on AUD/USD?
The ABS January jobs report will be published early on Thursday morning. As previously mentioned, the Australian economy is expected to create 20,000 jobs this month. fresh jobs, while the unemployment rate is forecast at 4.2%. Market participants will also pay attention to the division of positions into full-time and part-time.
Valeria Bednarik, Chief Analyst at FXStreet, notes: “The AUD/USD pair peaked at 0.7147 in the second week of February, the highest level since January 2023. It is currently trading in the 0.7070 area, after a corrective decline towards 0.7000. The upside momentum has moderated, but The case for higher highs in the future remains alive and well.”
“The daily chart of AUD/USD shows that it is trading well above the bullish moving averages, with the 20-day simple moving average (SMA) providing dynamic support around 0.7010, which further supports the psychological level. Meanwhile, technical indicators have fallen from recent highs but remain positive, with the Relative Strength Index (RSI) consolidating around 63. Overall, the risk of a deeper decline seems limited,– adds Bednarik.
As for the couple’s short-term prospects, Bednarik says: “An an optimistic report could push AUD/USD to 0.7100 and higherwith short-term resistance at 0.7130. Constant increases beyond the latter expose the mentioned multi-month maximum in the area of 0.7140. A discouraging reporton the other hand, may see AUD/USD near 0.7000although buyers will likely show up again as he gets closer.”
Employment FAQs
Conditions on the labor market are a key element in assessing the condition of the economy, and thus a key factor influencing currency valuation. High employment or low unemployment has a positive impact on consumer spending and therefore economic growth, increasing the value of the local currency. Moreover, a very tight labor market – a situation in which there is a shortage of workers to fill vacant positions – may also have an impact on inflation levels and therefore monetary policy, as low labor supply and high demand lead to higher wages.
The pace of wage growth in the economy is of key importance to decision-makers. High wage growth means households have more money to spend, which usually leads to higher prices for consumer goods. Unlike more volatile sources of inflation such as energy prices, wage increases are seen as a key element of underlying and sustained inflation because increases are unlikely to be reversed. When deciding on monetary policy, central banks around the world pay particular attention to wage growth data.
The weight that each central bank assigns to labor market conditions depends on its objectives. Some central banks have explicit labor market powers beyond controlling inflation. For example, the United States Federal Reserve (Fed) has a dual mission: promoting maximum employment and stable prices. Meanwhile, the sole task of the European Central Bank (ECB) is to keep inflation under control. Still, despite all the mandates it has, labor market conditions are an vital factor for policymakers, given their importance as an indicator of the health of the economy and their direct link to inflation.
Economic indicator
Unemployment rates are
Unemployment rate published by the Municipality Australian Bureau of Statisticsis the number of unemployed people divided by the total civilian labor force, expressed as a percentage. If the indicator increases, it indicates a lack of expansion in the Australian labor market and a weakness of the Australian economy. A decline in this value is seen as bullish for the Australian Dollar (AUD), while an raise is seen as bearish.
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