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New Zealand fourth quarter unemployment rate rises to 4.3 percent

Reuters logo Reuters 6/02/2019
a crane next to a building: FILE PHOTO: Construction workers unload equipment at a building site for a residential apartment block in central Wellington, New Zealand © Reuters/David Gray FILE PHOTO: Construction workers unload equipment at a building site for a residential apartment block in central Wellington, New Zealand

WELLINGTON (Reuters) - New Zealand's unemployment rate rose to a higher-than-expected 4.3 percent in the fourth quarter, according to data released by Statistics New Zealand on Thursday.

That was above the revised 4.0 percent unemployment rate recorded in the last quarter. The agency had recorded an unexpected decade low 3.9 percent unemployment rate in the last quarter, which was revised in Thursday's announcement.

Economists polled by Reuters had forecast a fourth-quarter unemployment rate of 4.1 percent.

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The employment growth rate in the quarter was 0.1 percent, down from 1.1 percent in the previous quarter. Economists had predicted an employment growth of 0.3 percent.

The Reserve Bank of New Zealand holds its policy meeting next week, when it is widely expected to hold interest rates at a record low of 1.75 percent.

Inflation edged up in the fourth quarter, and investors toned down some of the more aggressive bets on the prospects of an interest rate cut later in the year.

Statistics NZ said some high-level data was adjusted in the latest quarter to improve accuracy, which included figures for employed people, those not in the labour force, and hours worked.

Without the adjustment, the unemployment rate would have been 4.4 percent rather than 4.3 percent, Statistics New Zealand labour market and household statistics senior manager Jason Attewell said in a statement.

“The employment rate is now back in line with rates between the September 2017 and June 2018 quarters,” Attewell said.

The New Zealand dollar fell sharply to $0.6782 from $0.6825 immediately after the data was announced, and settled around a two-week low of $0.6773.

The labour participation rate fell to 70.9 percent from 71.1 percent, the data showed.

Annual wage growth was at 2.0 percent, compared to 1.9 percent in the previous quarter. Quarterly wage growth was unchanged from the previous quarter at 0.5 percent.

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