RBA outlook in focus as CBA Wage and Labour Insights point to still tight labour market conditions.
10 February 2026
Australia’s labour market remains tight and on a solid footing, but is not materially strengthening at this stage, according to the latest monthly CBA Wage and Labour Insights.
The report draws on de-identified salary flows from around 400,000 CBA accounts to provide an early snapshot of wages and employment trends, offering a timely view of shifting conditions at potential policy turning points ahead of official ABS data.
Australia’s wages growth held steady in January, with CBA data showing quarterly wage growth at 0.8 per cent and annual growth at 3.1 per cent. Overall, wages have been tracking broadly sideways, though there has been a gradual lift in quarterly outcomes since mid-2025
Western Australia continued to report the strongest wage gains, while outcomes across the eastern states remained steady.
“While wage growth is firm but not excessive, weak productivity growth means businesses continue to face elevated labour cost pressures,” Ottley said. “This underpins our assessment that labour market conditions remain tight and are still contributing to inflation.”
CBA’s Labour Insights indicate the economy added an estimated 21,000 jobs in January. Employment growth remains solid but is gradually moderating.
“The December official labour force survey was very strong and showed unemployment falling sharply, but that survey can be volatile. Our internal indicators do not suggest a material re-tightening in the labour market at this stage,” added Ottley.
Ottley said official and internal data would be closely watched in coming months. “Taken together, the January data point to a labour market that is still tight and on a solid footing, but not one that is materially strengthening.”
One more rate rise expected
CBA economists continue to expect one further interest rate increase in May, which would take the cash rate to 4.10 per cent. Monetary policy adjustments from here are likely to involve fine‑tuning rather than a renewed tightening cycle.
Read the full report: CBA Economic Insights: Wage and Labour Insights - January 2026
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Things you should know
NOT INVESTMENT RESEARCH. The Commonwealth Bank ‘Wage and Labour Insights’ is not investment research and nor does it purport to make any recommendations. The Commonwealth Bank ‘Wage and Labour Insights’ has been prepared without taking into account your objectives, financial situation (including your capacity to bear loss), knowledge, experience or needs. You should not act on the information contained in this document. To the extent that you choose to make any investment decision after having read this document, you should not rely on it but consider its appropriateness and suitability to your own objectives, financial situation and needs, and, if appropriate, seek professional or independent financial advice, including tax and legal advice. The data used in the ‘Commbank Wage and Labour Insights’ series is a combination of CBA Data and publicly available Australian Bureau of Statistics (ABS), CoreLogic and Reserve Bank of Australia data. Any reference made to the term ‘CBA data’ means the proprietary data of the Bank that is sourced from the Bank’s internal systems and may include, but is not limited to, home loan data, credit card transaction data, merchant facility transaction data and applications for credit. All customer data used, or represented, in this report is de-identified before analysis and is used, and disclosed, in accordance with the Group’s Privacy Policy.
