Wednesday, July 7, 2010

The Aussie Miracle Continues

As I've stated before, Australia is:

A commodity driven economy that has a close proximity to one of the world's fastest growing / largest commodity importing economy (China).
Bloomberg details the results:
Australian job growth capped the best quarter in almost four years in June, stoking the nation’s currency and stocks and heightening odds that the central bank will have to resume boosting interest rates.

The 45,900 increase last month exceeded all 22 forecasts in a Bloomberg News survey, a statistics bureau report showed in Sydney. The jobless rate held at 5.1 percent from the revised reading for May, marking the first time it’s below Japan’s level since at least 1978, according to data compiled by Bloomberg.

A strengthening job market may escalate pressure on inflation, which central bank Governor Glenn Stevens said two days ago is likely to accelerate above his target range. Today’s report is also a boost to Prime Minister Julia Gillard, who plans to call an election in coming months and has already pulled her party ahead of the opposition in opinion polls.

And something as removed as anything you'll hear in the U.S. these days:
“If you are worried about inflation, these numbers are telling you there’s very limited spare capacity in the labor market, you are approaching full employment,” said Su-Lin Ong, senior economist at RBC Capital Markets Ltd. in Sydney.
Source: ABS


  1. This is exactly why they could definitely afford a mega-mining tax. It would be anti-cyclical and the perfect move for the economy. It would shore up public finances and dampen the economy a bit.

    Oh well, the vast right wing conspiracy continues to spread its reach...

  2. australia does have an inability to withstand cyclical shifts via its currency (nice post on this by john hempton -, but i do like the idea you detail. it seems like an ideal time for it now vs. a hike in rates to slow the economy a bit.