Job numbers 'cast doubt' on future OCR cut
Figures revealed unemployment was 3.9% in the September quarter, better than anticipated and ahead of Westpac's forecast of 4.6%. The figures, coupled with strong recent GDP numbers showing the fastest rise in two years, could influence the Reserve Bank against a rate cut, economists Michael Gordon said.
Gordon said the job numbers would "be important for the RBNZ, casting further doubt on any notion of the Reserve Bank reducing the OCR".
Gordon added: "The HLFS survey can be jumpy and other measures suggest that the true picture is less extreme than the headline of unemployment suggests, but that’s still better than one might have expected if recent business confidence surveys were to be believed. Overall, the picture is one of moderate employment growth. Wage growth remains modest."
The job numbers come after the Reserve Bank introduced a new mandate to consider employment alongside its price stability mandate, when considering monetary policy.
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