Australia, NZ dollars tumble to multi-week lows, bonds battered

The selloff in risk assets overshadowed figures showing Australian employment rebounded by a solid 39,500 in August, well above forecasts for a gain of 20,000.

Yet the jobless rate still edged higher to a five-year top of 4.6% as more people entered the labour force, suggesting supply was rising to meet the demand for workers.

That will be of some comfort to Reserve Bank of Australia Governor Michele Bullock who has said unemployment between 4.5% and 5.0% was needed to help loosen the labour market.

"Even so, inflation pressures extend well beyond the labour market, with oil above $100 a barrel and core inflation stuck at 3.6%," said Oscar Guth, an economist for Oxford Economics Australia.

"With unemployment still at the bottom of the band Bullock outlined, we expect the RBA to hike rates at its meeting next week."

Markets imply a 95% chance the RBA will lift its cash rate by 25 basis points to 4.60% when it meets on September 29, and a possible peak of 5.10%. 0#AUDIRPR