Aussie Labour Costs Remain Sticky

• Australia’s Wage Price Index rose 3.4% y/y in Q4 2025, up from 3.3%, indicating wage growth remains steady rather than re-accelerating.
• Quarterly wages increased 0.8%, unchanged on the prior quarter and broadly in line with both expectations and the RBA’s forecasts.
• The outcome reflected modest firming across both private and public sectors, with private wages running at 3.4% y/y and public sector growth at 4.0% y/y.
• With the labour market still tight and capacity constraints persisting, the result does little to ease the RBA’s broader labour cost concerns. Some temporary factors may fade, but near-term cooling appears limited.
• Next locally is the January labour force report, where unemployment is expected to edge up to around 4.2%, testing whether conditions are gradually loosening.