Plunge in French joblessness gives Hollande rare boost

PARIS, Oct. 26 (AFP)

In a rare piece of good news seized on by embattled President Francois Hollande, France
recorded its sharpest drop in unemployment for 20 years in September, the labour ministry said
Tuesday.
It said 66,300 fewer people were looking for work last month, bringing the jobless total to
3.49 million in mainland France and more than erasing August's increase in job seekers of over
50,000. The total sneaked under 3.5 million for the first time since January 2015
Hollande, who has said he will not stand for re-election in April if he has not made a
"credible" dent in unemployment, hailed the figures, saying they reflected a "general trend".
"These results are the fruit of the government's efforts through the Responsibility Pact," he said
on his Facebook page, referring to a 2004 accord with business under which the government
cut payroll taxes in return for commitments from employers on job creation.
It was the largest monthly drop since 1996 when the government started its current method
of tracking unemployment. In percentage terms, September's 1.9 percent drop was the largest
since November 2000.
"The battle is not over," said Hollande, who will announce in December whether he will
seek a second term. "Unemployment remains too high and job insecurity remains a daily
reality for too many of our citizens," the Socialist leader said, adding that his aim is to
strengthen economic growth "without calling into question the principles of our social model."
France's unemployment rate is stuck at around double that of Germany or Britain, hovering
around 10 per cent. September's jobs surge followed a bleak August, when unemployment
registered its biggest monthly increase since January 2013.
The government said the jihadist attacks in Nice and Normandy in July, which led to a
significant fall in tourism, were partly to blame for August's jobless increase.

Australias Inflation Accelerates, Easing Pressure for Rate

Cuts
SYDNEY, Oct. 26 (Bloomberg)
Australias headline inflation accelerated last quarter, sending the currency up half a U.S.
cent and prompting money markets to pare bets on an interest-rate cut.
While annual inflation remains below the lower end of the Reserve Bank of Australias target
range, new Governor Philip Lowe has signaled a willingness to tolerate weaker price growth
given economic growth and unemployment remain solid.
Instead, hes stressed the risks of asset prices ballooning from a record-low 1.5 percent
benchmark cash rate. As a result, policy makers are unlikely to repeat the cuts made following
the previous two CPI reports.
The risk of a surprise November rate cut from the RBA has diminished, said James
McIntyre, head of economic research at Macquarie Bank whos been skeptical about the
economys strength.
Other key forecast variables, such as the exchange rate, oil prices, the unemployment rate,
and recent GDP growth do not, in our view, suggest enough downside pressure on the RBAs
prospective November forecast revision to compel a rate cut.
Inflation has lifted from the canvas, albeit with a lot of help from higher prices for fruit and
vegetables, said Craig James, senior economist at the securities unit of Commonwealth Bank of
Australia.
Still, the higher headline rate of inflation will serve to lift key measures of inflation
expectations and thus make it more likely that inflation will return to the 2-3 percent target band
in coming quarters.