Back to the latest jobs data, which is likely to support the Reserve Bank’s view of keeping interest rates on hold this year, with the numbers pointing to continued strength in the jobs market.

Australian Bureau of Statistics figures released today showed the unemployment rate held steady at 4.2 per cent in August, broadly in line with the RBA’s forecasts ahead of its interest rate decision next week.

The RBA has been keeping rates on hold in an effort to bring inflation down by slowing down the economy while preserving gains in the labour market.

Oxford Economics Australia head of macroeconomic forecasting Sean Langcake said that, while the latest jobs data showed the labour market was gradually slackening, it remained relatively tight, confirming his view that the RBA would not be able to ease rates until next year.

The market has been pricing in 20 basis points in rate cuts before the end of the year.

The underemployment rate – the share of people wanting to work more hours, but unable to find additional work – increased from 6.3 per cent to 6.5 per cent from July to August.

IG Australia market analyst Tony Sycamore said the Australian economy added about 47,000 jobs in August, stronger than the 25,000 expected by the market.

Taken together with the US Federal Reserve’s decision to cut rates by 50 basis points this morning, Sycamore said there was a strong case for the RBA to hold rates steady as it monitored other pieces of data following the decision, including the next monthly inflation reading due on Wednesday next week.

“Today’s employment rise has exceeded expectations once again, with the labour market cooling more slowly than anticipated,” he said.