November 5, 2021

Do you trade NZD/USD? This is Good News From New Zealand!

 The kiwi dollar struggled to find an opportunity to record a strengthening in the Asian trading session after being highlighted by strong New Zealand employment data readings in the third quarter.

Statistics New Zealand reported the unemployment rate fell sharply to 3.4%, the lowest level ever recorded since the fourth quarter of 2007 before the onset of the global financial crisis in 2008.

The last time the unemployment rate was recorded below 4% was in June 2008, just before the worst effects of the financial crisis hit the world economy.

The number of unemployed also dropped by 18,000 during the quarter to 98,000 combined with another 54,000 people employed, causing the unemployment rate to drop.

Workers in demand following the closure of the New Zealand border have reduced the supply of imported labor. Wage increases add to inflationary pressures that have prompted central banks to start raising interest rates.

Meanwhile in a separate statement, the Governor of the Central Bank of New Zealand (RBNZ), Adrian Orr said the job market is very volatile at the moment, and that is why the central bank only raised rates by 0.25% compared to initial expectations of 0.50%.

The New Zealand dollar rose slightly following the release of the data after recording weakness in the previous session following the strengthening of the greenback dollar ahead of the FOMC meeting policy announcement.