Western Australia’s unemployment rate ticked up to 3.8% in June, from 3.6% in May, largely driven by a decline in the size of the labour force with just over 7,000 people leaving jobs over the month. 
Nationally, Australia’s unemployment rate also rose, now reading 4.1%, from 4.0% in May. WA’s unemployment rate remains one of the lowest across the country, behind only Tasmania and the ACT. Despite some of the difficulty this continues to cause businesses in hiring workers, the ongoing strength of WA’s labour market stands to support economic activity more broadly.
Global disinflation looks to have resumed
After a period of stickiness, global disinflation across major economies looks to have continued its journey towards target. This is highlighted by US inflation falling for the fourth consecutive month to 3.0% in June, inflation in the UK remaining steady at 2.0% and Germany’s inflation rate falling back to 2.2%.
The slow momentum in global disinflation has delayed some central banks from cutting their policy rates, although this latest progress has given some confidence that rate cuts are now on the horizon.
Despite this progress, high services inflation remains a key risk to headline inflation returning to target. This is particularly the case in Australia, where all eyes will be firmly fixed on next Wednesday’s inflation data to see if this global trend has extended to our shores.
Building activity remains constrained
In a sign that WA’s residential construction industry continues to be constrained, recent building activity data revealed the number of new houses completed in the State declined over the March quarter. 
Builders managed to pump out 4,242 dwellings over the quarter, almost 200 less than the December quarter. While this is still close to the highest levels seen since 2019, it is well down compared with historical levels and should see the housing market continue to remain tight for some time yet.
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