WELLINGTON, May 9 (Reuters) - New Zealand created 38,000
jobs in the first quarter, the highest ever, sending the jobless
rate to its lowest in three years, but the strong data was not
expected to alter the central bank's plan to keep interest rates
at a record low for an extended period.
The unemployment rate fell to 6.2 percent from a downwardly
revised 6.8 percent in the previous quarter, according to
official data on Thursday.
A Reuters poll forecast a jobless rate of 6.8 percent.
- Unemployment rate at lowest since March 2010
- Employment +1.7 pct s/adj or 38,000 jobs, the highest ever
- Full time employment +1.8 pct, part time +1.3 pct
- Participation rate 67.8 pct from 67.2 pct (Poll 67.8 pct)
- Stats NZ's employment rate 63.7 pct from 62.7 pct in Q4
- Click on for a table for the main figures.
KIERAN DAVIES, ECONOMIST, BARCLAYS
'It shows the statistics had no relationship with the
broader economy and this upside surprise today helps bring them
more back in line... Growth is picking up.
'The RBNZ is uncomfortable with house prices and I think
they will keep rates on hold this year but the risk is that
quantitative measures don't take the heat out of the housing
market and that will be a problem for rates.
The next rate move is up but not until the middle of next
SU-LIN ONG, SENIOR ECONOMIST, RBC CAPITAL MARKETS
'These data should come with a health warning given they are
so volatile. But on the face of it they do look strong across
the board. Most of the jobs growth was full-time, and the
jobless rate dropped even though participation picked up.
'However, the jobs are really concentrated in the rebuild of
Christchurch and outside of that, there's not a whole lot going
on. An unemployment rate between 6 and 7 percent is still pretty
elevated for New Zealand, so I would caution against getting
carried away by these numbers.'
BEN JARMAN, SENIOR ECONOMIST, JP MORGAN
'We had a 1 percent fall last quarter but we thought it had
some peculiar elements to it...
'There wasn't really anything fundamental about the
deterioration. So we've bounced back very strongly with a high
participation rate which means the economy was able to absorb
'This move has realigned us with where other indicators
suggested where the economy was all along. It will give the RBNZ
a bit more conviction that the grinding recovery is continuing.
We see the RBNZ hiking rates in September.'
DARREN GIBBS, CHIEF ECONOMIST, DEUTSCHE BANK
'It's obviously stronger than the market was expecting.
'What looks a little odd to me is the fall in the
unemployment rate. The level of labour force participation still
looks very looks low over the last three months relative to what
the trend had been in the December quarter.
'I suspect there's a little more labour slack than the
'The labour market numbers earlier in the week showed
declining labour cost inflation. so there's no need to change
the RBNZ's view on that basis.'
- The New Zealand dollar jumped to a session high
of $0.8470 from around $0.8415 before the data. It last traded
around $0.8460. Interest rate futures were down 0.03
- The Statistics New Zealand Web site is:
- For all New Zealand news and data, 3000 Xtra users can
- NZ's jobless rate has ranged between 6 to 7 pct since Q2
2009 as the economy has posted patchy and uneven growth against
an uncertain global outlook.
- The Reserve Bank of New Zealand last month held interest
rates at 2.5 percent, with no urgency to move because of low
inflation, modest growth, and high exchange rate.
- The latest Reuters poll shows all 15 analysts expecting
the next move to be a rise, with 12 of the respondents favouring
early next year for the start of the tightening cycle.
- In its March monetary statement, the RBNZ forecast
unemployment to be 6.7 pct in the year to March 2013 and 6.0
pct in March 2014.
- Data earlier this week showed wages growing 1.8 percent in
the year to March, while the number of hours worked were steady
and filled jobs rose, pointing to an improving but still soft
- A measure of job advertisements from the ANZ Bank rose a
seasonally adjusted 0.7 percent in March, pointing to a jobless
rate around 7 percent over the first half of this year.
(Reporting by Gyles Beckford; Editing by Lincoln Feast)
Keywords: NEWZEALAND ECONOMY/JOBS/
(Gyles. Beckford@thomsonreuters.com)(+64 4 802 7980)(Reuters)(Messaging: email@example.com)
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