4 things to think on
Recent weeks have been characterised by a sharp repricing of interest rate futures, as markets ponder whether inflation risks might be reigniting (and if so how significantly).
There was a dribble of markets news today, which might share a few common threads.
Firstly, fixed mortgage rates are already rising - a few details below courtesy of the red bank:
Source: Westpac broker channels
Secondly, a weakening of the jobs market should in theory result in slower immigration through 2026, particularly as tighter temporary visa rules begin to bite.
That having been said, today's arrivals and departures figures showed no signs of slowing just yet.
Permanent and long-term arrivals over the year to October hit a new all-time high of 1.144 million, while net permanent and long-term arrivals over the year rose for a 9th month to +476,000.
Thirdly, the initial burst of confidence around new home sales triggered by the government's deposit guarantee may already be popping.
Private new home sales fell by another -16 per cent in November after a decline in October, suggesting that hopes for a residential construction boom may already be tempering somewhat.
Source: Housing Industry Association
And fourthly, a recent rise in underemployment and underutilisation may result in shifts in the characteristics of the Aussie labour force.
The ABS reported today that 36 per cent of people still work from home some or all of the time.
Source: ABS, Shane Oliver (AMP)
While this is of course well down from the pandemic highs, there does seem to have been a recent plateau.
It seems very unlikely that this multi-decade trend will unwind dramatically given the shifts in employer/employee expectations, but trends in other countries (e.g. Canada) suggest that any sharp rise in unemployment could be accompanied by a rapid return to office work.
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