WELLINGTON — New Zealand’s jobless rate
fell more than expected in the second quarter, sending the kiwi
dollar up as markets saw the upbeat data as a further sign that
monetary policy will be tightened this month.
Data released by Statistics New Zealand on Wednesday showed
the jobless rate fell to 4.0% in the quarter ending June from
4.7% in the previous quarter, when analysts had expected it to
hold at 4.5%.
The jobs figures are back at pre-COVID levels and the lowest
since the third quarter of last year when pandemic lockdowns saw
the unemployment rate surge to 5.3%.
The New Zealand dollar rose 0.4% on the upbeat news
to reach $0.7041.
The participation rate rose to 70.6% and the
underutilisation rate fell to 10.5%.
New Zealand’s early response to the pandemic has allowed the
economy to return to pre-pandemic normalcy, though a lack of
foreign tourists has badly hit key sectors.
New Zealand had to shut down a travel bubble with Australia
last month due to a fresh outbreak in Sydney.
The strong jobs data affirms view of economists that the
Reserve Bank of New Zealand (RBNZ) will raise interest rates
when it meets on Aug. 18.
“Today’s report all but confirms a rate hike from the RBNZ
in August. Strap yourselves in,” said Kiwibank Chief Economist
(Reporting by Praveen Menon; Editing by Jacqueline Wong)