The unemployment rate has plummeted to 4 per cent, putting more pressure on the Reserve Bank to raise interest rates in a fortnight's time. Bank economists had been expecting a significant but smaller drop in the unemployment rate, from 4.7 per cent in the March quarter to 4.4 per cent. ANZ and BNZ are now forecasting the official cash rate will rise to 1 per cent by the end of the year, with BNZ research head Stephen Toplis describing the unemployment data as a “stonker”. “I think they will perhaps not slam the brakes on too quickly.”Finance Minister Grant Robertson noted the 4 per cent unemployment rate compared favourably with Australia, where the unemployment rate is 5.2 per cent, and the 5.9 per cent unemployment rate in the United States. Stats NZ said New Zealand’s unemployment rate was now the eighth lowest in the 38-member OECD (Organisation for Economic Co-operation and Development).

Source: Stuff August 03, 2021 22:49 UTC