NZ Dollar Rises After Employment Report Surprises Positively

The New Zealand dollar rallied today, though it has trimmed gains against some of its rivals by now. The catalyst for the rally was the release of surprisingly good domestic employment data.
Statistics New Zealand reported that the number of employed people decreased by 0.4% in the June quarter. While not a good figure by itself, the drop was nowhere near 2.0% predicted by specialists. On top of that, the previous quarter’s increase got a positive revision from 0.7% to 1.0%. The seasonally adjusted unemployment rate fell to 4.0% from 4.2% in the previous quarter. That was a total surprise to experts who were expecting a big jump to 5.6%. The only negative surprise came from the Labor Cost Index, which rose just 0.2% versus expectations of a 0.4% growth and a 0.3% gain registered in the preceding quarter. The labor force participation rate fell by 0.8% to 69.7%, meaning that there were fewer people seeking jobs in the first place, which could partly explain the drop in the unemployment rate.
Released separately, the ANZ Commodity Price Index demonstrated a jump by 2.3% in July. The increase followed a 0.8% drop in the previous month. Commodity exports are an important part of the New Zealand economy, therefore rising commodity prices are helpful for the nation’s economic growth.
NZD/USD climbed from 0.6623 to 0.6666 as of 9:48 GMT today. EUR/NZD fell from 1.7813 to 1.7788, touching the low of 1.7749 intraday. NZD/JPY jumped from 70.02 to 70.44.
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