"Because of the issues with data quality, we are inclined to just look through the results of today's survey and stick with our prior premise that the labour market is in decent shape and the unemployment rate is trending lower. Spare capacity is being absorbed, but only gradually, and that is contributing to modest wage growth".
-NZD economists
According to the latest release, New Zealand's unemployment rate dropped more than expected during the second quarter as Statistics New Zealand's agency decided to adopt a new way in order to measure the labour market in line with international practices, as well as while the expanding economy continued to support jobs growth. The jobless rate in New Zealand equals 5.1% in the second quarter of 2016. The following data was below expected forecasts for 5.3% and down from the downwardly revised 5.2% in the previous three months (originally 5.5 percent). Overall, the employment change was 4.5% on a yearly basis to 2.46 million, exceeding expectations for 2.3% and up from 2.0% in the three months prior. Meanwhile, on a quarterly basis, the employment change was 2.4% - also exceeding forecasts for 0.6% after gaining 1.3% in Q1. Moreover, applying new methodology, the statistics showed unemployment went down across many North Island regions, including Auckland. The country's biggest city unemployment rate equals to 4.7% in the June quarter, showing the lowest rate since 2008.
In the meantime, after an initial surge, the New Zealand Dollar failed to keep gains against its US counterpart since strong employment data appeared be overshadowed by last RBNZ statement.
© Dukascopy Bank SA