Daily Commentary BY THE CURVE TEAM –

Jobs and House Prices Strong

3rd of May, 2021

Updates on job ads and dwelling prices for April suggest a clear trend.

Job ads were up 4.7% for April from already high levels. This makes for eleven months of gains in ads and leaves them 27.8% above pre-covid levels.

Over the last 15 years only GFC levels have been higher. It bodes well for the many employees falling off the JobKeeper payment and would back strong employment forecasts from the RBA in their statement monetary policy released on Friday.

Dwelling prices for April aligned with the strong credit data for March. Prices were up 1.8% for the month following gains of 2.8% in March and 2% in February.

Similar to previous months, house prices led the gains, up 2% whereas units were up 1.2% for the month. Annually dwelling prices are up 6.4%, but over 2021 they are up 7.5%.

Both the job ads and dwelling prices continue to rise from already high levels. Although this is very positive for the economic recovery, it will likely lead to fears of the economy running too hot.

The RBA today are expected to hold the line on their policy stance, but the more the economy runs hot, the more pressure there will be to either tighten policy or at least give forward guidance on how they will unwind policy.

Josh Stewart

Associate - Money Markets