NZ: Unemployment back up again – ANZ

ANZ analysts note that New Zealand’s unemployment rate rose to 4.2% in the September quarter, in line with ANZ’s forecast but a touch higher than the market expected.

Key Quotes

“Employment was up a soft 0.2% q/q, with annual growth falling to 0.9% y/y from 1.4%.”

“Private sector wages lifted 0.6% q/q, in line with market expectations, resulting in a tick-up in annual growth to 2.3% y/y. Public sector wages surged on the back of collective agreements.”

“The Q3 labour market print is unlikely to be a game-changer for the MPS decision next week, as the labour market data generally lags broader economic activity. But softer economic momentum looks set to persist at least until the end of the year. We continue to expect an OCR of 0.25% by mid-2020 (with cuts in November, February, and May).”