RBA expected to hold despite jobs growth

STRONG jobs growth and an increase in inflation predictions are not be enough to cause a rate rise today, economists say.

Strong jobs growth and an increase in inflation predictions are not be enough to cause a rate rise today, economists say / File

STRONG jobs growth and an increase in inflation predictions will not be enough to cause another official interest rate rise today.

Despite the latest ANZ figures showing a 2.9 per cent increase in the number of job ads in newspapers and on the internet last month, and a leading inflation measure showing price rises hitting the Reserve's 3 per cent threshold, economists were tipping the bank would hold off until at least April before lifting rates, The Australian reports.

The predictions came after the ANZ job advertisements series reported its seventh consecutive monthly rise, to be 33.2 per cent higher than a year ago.

Newspaper job ads rose 0.9 per cent in the month, while internet job ads rose 3 per cent.

Mr Colhoun expected the RBA would again be thinking about a rate rise after the second quarter next year.

The RBA surprised the markets by raising official interest rates by 0.25 per cent last month after declining to increase rates in October.

Traditionally the bank has held off on increases in December as the nation heads into the Christmas period.

And given anecdotal reports of more moderate consumer behaviour since last month's rate rise, "it is reasonable to expect some moderation in the rate of growth of labour demand in the months ahead", Mr Colhoun said.

The strong jobs figures came as the TD Securities-Melbourne Institute monthly inflation gauge rose by 0.4 per cent last month, putting the annual rate at 3.9 per cent and making November the fourth month in a row that the inflation gauge had been at or above the RBA's 3 per cent target.

Read more about rates in The Australian.