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New Zealand revises down its Q1 unemployment rate to 5.2%
[WELLINGTON] Statistics New Zealand revised its seasonally adjusted first quarter unemployment rate to 5.2 per cent on Wednesday from 5.7 per cent after adjusting how the data is measured.
The statistics agency said it had implemented a series of changes in order to improve accuracy, in particular around identifying active job seekers.
Specifically it noted that looking at job advertisements on the internet is now correctly classified as “not actively seeking work”. As a result, “fewer people will be classified as actively seeking work, therefore the counts of people unemployed will be more accurate.”
The first quarter participation rate was revised to 68.7 versus the previously number of 69.0. “From a capacity perspective that offsets some of that lower unemployment rate,” said ANZ Economist Philip Borkin. Mr Borkin said he did not expect the data to have much impact on whether or not the central bank opts to cut interest rates further in August.
The Reserve Bank of New Zealand (RBNZ) held its benchmark policy rate at a record-low 2.25 per cent in June but indicated it could cut rates again due to low inflation. Earlier on Wednesday the central bank reiterated that further policy easing may be required.
The central bank is mandated to keep annual inflation in a target range of 1 per cent to 3 per cent. Annual inflation is currently running at around 0.4 per cent.
Mr Borkin said he doesn’t expect it to “alter the world at all for the RBNZ at all. They are still going to be a central bank that is reacting to CPI outcomes more than some indicators like this.”