The odds of another interest rate cut have been slashed as weak jobs figures drive up expectations of a cut in July and pressure mounts on the government to bring forward $12 billion worth of tax cuts to stimulate the economy.
Investment bank UBS and left-wing think tank Per Capita have both backed the case for stage two of the Coalition’s tax cuts – due to start in 2022 and worth $2400 a year for average income earners – to be introduced immediately to drag the economy out of its worst patch since the global financial crisis.
The Australian Bureau of Statistics on Thursday reported the jobless rate steady at 5.2 per cent last month but with growing signs it is slowing. Full time employment lifted by just 2400, with all the growth due to a surge in part-time workers, many of whom were hired for the May federal election.
Key measures of under-employment and under-utilisation, which suggest people are unable to get the hours they want, all lifted in May with the rate for those aged between 15 and 24 at 30 per cent.Advertisement