Employment in the December quarter returned to pre-covid-19 levels, indicating that the official employment situation has further improved, and GDP is stronger than expected. The Reserve Bank of Australia may reduce its quantitative easing program as early as April. Bjorn Jarvis, Director of the Bureau of Labor Statistics of ABS, said: “From early December to mid-December is the seasonal peak of annual employment. The latest data shows that by that time, employment had risen to the level of mid-March. “As the labor market and GDP strengthen and the Australian dollar and house prices begin to stabilize, the Reserve Bank of Australia may also soften its A$100 billion bond purchase plan. According to data from the Housing Industry Association (Housing Industry Association), new home sales across Australia nearly doubled from the previous month, and are now up 32.5% from the same period last year. The ASX200 index closed up 1.19% on Tuesday. Other economists remain cautious about ending quantitative easing prematurely by the Reserve Bank of Australia. NAB economists expect the Reserve Bank of Australia to extend its quantitative easing policy by another $50 billion in the next six months. The President of the Reserve Bank of Australia, Philip Lowe, will signal this as early as February. NAB’s Alan Oster said: “Despite the improved outlook, the epidemic has still dealt a major blow to the economy, so it is necessary to adopt an unusually loose policy.” The monthly increase in working hours in November was 2.5%, and it is expected to increase further in December.
https://www.afr.com/policy/economy/payrolls-rebound-to-pre-crisis-20210119-p56v6k