| Consensus | Consensus Range | Actual | Previous | |
| Quarter over Quarter | 0.8% | 0.7% to 0.9% | 0.8% | 0.8% |
| Year over Year | 3.4% | 3.4% to 3.4% | 3.4% | 3.4% |
Highlights
Australia's wage price index rose 0.8 percent on the quarter in the three months to December, as it did in the three months to September, with year-over-year growth in the index also unchanged at 3.4 percent. Monthly labour market data over that period showed a fall in the unemployment rate, with the participation rate also falling from its recent highs.
Market Consensus Before Announcement
Wages seen up 0.8 percent on quarter and 3.4 percent on year in Q4 after the same increases of 0.8 percent and 3.4 percent in Q3.
Definition
A measure of the price employers pay for labour due to market factors, specifically wages and salaries. Wages and salaries reflect payments in cash or kind that are made at regular intervals and include: piecework payments; enhanced or special allowances for working overtime or unsocial hours; regular supplementary allowances ; payments for employees away from work for short periods but not including absences for sickness or injury; and bonus and incentive payments.
Description
The wage price index is an easy way to evaluate wage trends and the risk of wage inflation. Officials at the Reserve Bank of Australia closely monitor wage inflation to assess the outlook for consumer prices and broader inflationary pressures. Wage pressures tend to strengthen when economic activity is booming and the demand for labor is rising rapidly. During economic downturns, wage pressures tend to be subdued because labor demand is down. By tracking labor costs, investors can gain a sense the outlook for inflation and monetary policy, with interest rates more likely to rise when wage inflation is high.