A surprise fall in the unemployment rate will undoubtedly put pressure on the Reserve Bank to lift rates for the fourth consecutive time when they meet again on 2 February.
According to data from the Australian Bureau of Statistics (ABS), the unemployment rate fell 0.1 per cent in December 2009 to 5.5 per cent, its lowest level since April 2009.
The number of people unemployed in Australia decreased by 10,600, or 1.6 per cent, to 639,400.
The number of people in work grew by 35,200, three times more than economists had predicted.
Yesterday, the government took credit for the drop in unemployment, with acting Prime Minister Julia Gillard attributing the fall to the government’s stimulus packages.
“The result shows what we have achieved by pulling together in tough times and getting behind the government’s stimulus actions,” she said.