State Street economist comments on recent Labour Force data, urging RBA caution

By Newsdesk

November 13 2025
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In light of the recently released Labour Force data, Krishna Bhimavarapu, an economist at State Street Global Advisors, has provided insights that may influence the Reserve Bank of Australia's (RBA) future monetary policy decisions. State Street, a global leader in financial services with an impressive US$46.8 trillion in assets under custody and administration, and $4.7 trillion in assets under management, offers a significant perspective on these developments.

State Street economist comments on recent Labour Force data, urging RBA caution

The latest data reveals a decline in the unemployment rate, a detail that Bhimavarapu believes could impact the RBA's approach. "Today’s data strengthens the case for the RBA to remain on hold for longer than we thought earlier," Bhimavarapu stated. This sentiment reflects a growing belief that the RBA might need to exercise patience before considering any shifts in its monetary policy stance.

Despite the unchanged participation rate, the drop in unemployment suggests a degree of underlying resilience in the labour market. Bhimavarapu noted, "The decline in the unemployment rate, despite an unchanged participation rate, suggests underlying resilience." This resilience could be indicative of a stabilising economy, but Bhimavarapu advises caution in interpreting these figures.

The data also highlights specific nuances within the labour market, particularly concerning the incoming rotation group. "However, caution is warranted: participation within the incoming rotation group stood at 68.2%, while its unemployment rate remained elevated at 4.6%," Bhimavarapu explained. This elevated unemployment rate within a significant segment of the labour force suggests that not all areas of the economy are experiencing the same level of recovery.

These figures support the RBA's decision to maintain its current stance rather than moving towards tightening monetary policy. "Overall, the data supports the RBA’s decision to stay on hold rather than shift toward a tightening stance," Bhimavarapu affirmed. This approach aligns with the central bank's cautious outlook as it monitors various economic indicators to guide its policy decisions.

The RBA's current policy settings have been a topic of widespread discussion, especially as the Australian economy navigates the complexities of post-pandemic recovery. The central bank has been under pressure to balance supporting economic growth while keeping inflation in check. The latest labour data provides crucial insights that could influence the timing and nature of any future policy adjustments.

State Street's analysis underscores the importance of a measured approach in the face of evolving economic conditions. The company's extensive experience and global reach lend weight to its assessments, offering valuable perspectives for investors and policymakers alike. As the RBA continues to evaluate the economic landscape, insights from financial experts such as Bhimavarapu will play a critical role in shaping expectations and strategies.

The recent Labour Force data presents a mixed picture of Australia's economic recovery. While the decline in the unemployment rate is a positive development, underlying complexities within the labour market warrant a cautious approach. State Street's commentary serves as a reminder of the delicate balance the RBA must maintain as it navigates the path forward, ensuring that policy decisions are informed by a comprehensive understanding of the economic landscape.

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