PREVIOUS TRADING DAY EVENTS 03 May 2023

Announcements 

New Zealands unemployment rate remained unchanged at 3.4 according to the latest release of Stats NZ yesterday. Economists expected a rise to 3.5. Wage inflation quickened to 4.5.

The Reserve Bank of NZ is raising interest rates to slow demand and estimates that there will be a recession this year. It is possible that the central bank is likely to hike interest rates later this month.

Labor cost growth was not as strong as expected, but still hit a record annual high with widespread lifts, said Mark Smith, senior economist at ASB Bank in Auckland. Both weaker demand and stronger supply should see greater labour market slack emerge over 2023, but the RBNZ is unlikely to shirk from further monetary tightening.

The next policymakers meeting is on May 24 and the consensus is a final 25 basispoint hike, bringing the Official Cash Rate to 5.5.

Source httpswww.bloomberg.comnewsarticles20230502newzealandjoblessrateheldsteadyat34infirstquartertextThe jobless rate was unchanged,wage inflation quickened to 4.5.

The U.S. ADP National Employment Report was released showing that private sector employment increased by 296,000 jobs in April. The market was expecting just a 148K increase so this was quite a surprise. Annual Pay was up 6.7, the biggest private payrolls gain since July. This adds to the data suggesting a resilient labour market even as the economy cools.

The slowdown in pay growth gives the clearest…