Rate cut unlikely as job, profits grow
In demand: Businesses are starting to hire new workers. Picture: Megan Powell/The West Australian

The nation's businesses have started the year looking for new staff and building their profits as signs grow the economy is lifting.

Ahead of today's Reserve Bank board meeting, expected to keep official interest rates on hold, key figures suggest the non-mining part of the economy is picking up some of the slack left by the slowing resources sector.

ANZ's measure of job advertisements rose 5.1 per cent last month.

It followed similar rises in SEEK's new internet jobs measure and the Department of Employment's job vacancies index.

Newspaper advertisements rose in all States but Victoria, with positive signs in WA where they rose 1.6 per cent. Australian Bureau of Statistics figures showed profits through the final three months of last year lifted 1.7 per cent. Profits grew 10.7 per cent over the full year - the biggest gain in three years.

Inventories fell, suggesting a drag on the December quarter GDP result due out tomorrow. But it also suggests firms were unable to keep up with customer demand.

ANZ senior economist Justin Fabo said the job figures were an encouraging sign. "Very low interest rates and the lower Australian dollar are providing support to the Australian economy," he said.

There have been fears that current interest rate settings are feeding into a new housing bubble, particularly in Sydney.

But RP Data-Rismark's monthly measure of home values, released yesterday, showed a 0.2 per cent fall in Perth last month. House values edged down 0.4 per cent to be 0.2 per cent lower over the quarter.

But house values have lifted 7.2 per cent over the full year.

Housing Industry Association new home sales figures showed a modest 0.5 per cent lift in sales in January. Sales fell 1.1 per cent in WA, but over the past six months the State's property market is more than 36 per cent higher than at the same time a year ago.

The West Australian

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