Australia’s unemployment rate remained at 4.1 per cent in January, the same as in December, in seasonally adjusted terms.

The number of employed people grew by 17,800.

Full-time employment rose by 50,000 people, which was partly offset by a fall of 33,000 people in part-time employment.

In trend terms, which smooths out seasonal volatility, the unemployment rate declined a little in January from 4.2 to 4.1 per cent, to a nine-month low.

Economists say the numbers suggest that the labour market remains relatively tight and the economy is still operating close to capacity.

RBA governor grilled over rising inflation

RBA governor Michele Bullock refuses to blame the Albanese government for rising inflation, as a political fight breaks out in the wake of the bank’s rate hike.

“From the Reserve Bank’s perspective, the failure of the labour market to weaken means it will not be able to shift its gaze away from upcoming inflation data,” David Bassanese, BetaShares chief economist, said.

Marcel Thielant, head of Asia-Pacific at Capital Economics, said the numbers would keep pressure on the RBA.

“With wage growth remaining stubbornly high and trimmed mean inflation well above the upper end of the RBA’s 2-3 per cent target band, the case for further [interest rate] tightening by the bank therefore remains strong,” he said.

“We’re sticking to our forecast that the bank will lift rates to 4.35 per cent by the second half of the year.”

The cash rate target is currently 3.85 per cent. 

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