Wage data unlikely to trigger rate rise

(AAP) - Wages figures released on Wednesday do not seem likely to provide the Reserve Bank of Australia (RBA) with a rationale to raise interest rates next month.
The bureau's wage price index for total rates of pay, excluding bonuses, rose by 0.8 per cent in seasonally adjusted terms in the March quarter, according to data released by the Australian Bureau of Statistics (ABS) on Wednesday.
Annual growth in the index was 3.8 per cent, down from 3.9 per cent and just one tenth of a percentage point faster than the average of the preceding decade.
For the more market-sensitive private sector, the quarterly rise was 0.9 per cent, with annual growth of 3.9 per cent.
That was up from the 3.8 per cent recorded over the year to December, but still not much over the average of 3.6 per cent for the decade to March 2010.
The peak for private sector wages growth was 4.4 per cent, according to this measure which began in 1997.
That was recorded over the year to June 2008, at the tail end of what the Treasury refers to as Mining Boom Mark I and before the global financial crisis hit home.
At that point, the unemployment rate had been below the current 4.9 per cent for over two years, so right now the economy is still some way from recreating the tight labour market and rising wage conditions seen in mid-2008.
A rate rise next month is always possible.
The RBA has flagged a likely increase "at some point" twice in recent weeks, against the background of a forecast rise in wage and price inflation and lower unemployment.
And the RBA bases its interest rate decisions on what is expected to happen, not what is happening at the moment.
But the wages figures released by the ABS on Wednesday suggest the expected inflationary day of reckoning has not come much closer and that the RBA may have a little more breathing space than widely supposed.