Bank of Australia Governor Michele Bullock said that rising unemployment would help ease inflationary pressure, but declined to say whether she would support interest rate hikes during next week's interest rate meeting. While attending a discussion in Sydney on Tuesday, Bullock said the current 4.5% unemployment rate means the labor market is “somewhat tight.” “I think the unemployment rate of 4.5% to 5% may be enough to cool the labor market and thus ease inflationary pressure,” she said. Australia will release employment data for August on Thursday, and economists expect the unemployment rate to remain unchanged at 4.5%. Bullock said that the fundamental problem with current high inflation is that economic demand exceeds the economy's ability to provide goods and services, and a tight labor market is one sign of this imbalance between supply and demand. The Bank of Australia will announce its interest rate decision next Tuesday. Swap market pricing indicates that the probability that the central bank will raise interest rates by 25 basis points next week is about 90%.

Bank of Australia Governor Michele Bullock said that rising unemployment would help ease inflationary pressure, but declined to say whether she would support interest rate hikes during next week's interest rate meeting. While attending a discussion in Sydney on Tuesday, Bullock said the current 4.5% unemployment rate means the labor market is “somewhat tight.” “I think the unemployment rate of 4.5% to 5% may be enough to cool the labor market and thus ease inflationary pressure,” she said. Australia will release employment data for August on Thursday, and economists expect the unemployment rate to remain unchanged at 4.5%. Bullock said that the fundamental problem with current high inflation is that economic demand exceeds the economy's ability to provide goods and services, and a tight labor market is one sign of this imbalance between supply and demand. The Bank of Australia will announce its interest rate decision next Tuesday. Swap market pricing indicates that the probability that the central bank will raise interest rates by 25 basis points next week is about 90%.