- ANZ
New Zealand's first quarter employment data showed unemployment rose as the participation and employment rate also increased. The unemployment rate ticked higher to 5.7% in the reported period, from a revised 5.4% the prior quarter and above the forecast of 5.5%. Despite the increase in unemployment, the data suggested the economy was performing well. The participation rate advanced to 69.0% while employment rose 1.2%. However, of those entering the labour force 10,000 failed to find jobs, while the remaining 28,000 were employed. The cost of labour index rose 1.8% on an annualized basis in the March quarter, up from 1.6% in the three months through December. From the fourth quarter to the first quarter, labour cost grew 0.4%, in line with the prior quarter. In the March quarter, New Zealand's inflation climbed 0.4% on year, meaning real wages are still growing at a strong pace, which is likely to continue to boost consumption. The RBNZ is expecting annual inflation at 1.1% by end-2016, down from the forecast of 1.6% made at its December policy review, and just inside its 1% to 3% target range.
Meanwhile, New Zealand house prices continued to rise at a solid pace in April with low interest rates supporting demand for housing. Residential property prices rose 12% year-on-year in New Zealand last month.
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