New Zealand in recession
NZ unemployment continues to rise as employment falls.
The New Zealand labour market indicates that the economy is in recession, with unemployment rising further as employment falls.
GDP has fallen almost continuously for over a year now, while the unemployment rate has risen from a low of 3.2% in late 2021/early 2022 to 4.3% in Q1, with employment falling by 0.3% in the quarter (noting the volatility of the quarterly numbers, CCI estimates that trend employment stalled in Q1).
Labour costs continued to grow more slowly, up by less than 3¾% in annualised terms in Q1, which is down from the COVID-era peak of 4½%, but above the pre-pandemic average of about 2½%.
The numbers are a little worse than the RBNZ had forecast in February, where it had expected an unemployment rate of 4.2% in Q1 and a 0.1% gain in employment.
The RBNZ is forecasting that it will start cutting rates in Q2 next year, but the weakness of the economy still suggests it could start easing policy later this year.
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Based in Sydney, Kieran Davies is Chief Macro Strategist at Coolabah Capital Investments, an asset manager with 40 executives and over $8 billion in fixed-income strategies. Kieran is responsible for macroeconomic research and investment strategy, contributing to the investment decisions of the firm. Kieran has long experience as a macroeconomist in both the private and public sectors. He has worked most recently as Chief Markets Economist for National Australia Bank and was previously Chief Economist, Australia and New Zealand, for Barclays Bank and ABN Amro Bank/RBS. Kieran also worked as Principal Adviser on the macroeconomy and budget policy in the Commonwealth Treasury and Director of Forecasting.
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Based in Sydney, Kieran Davies is Chief Macro Strategist at Coolabah Capital Investments, an asset manager with 40 executives and over $8 billion in fixed-income strategies. Kieran is responsible for macroeconomic research and investment strategy,...
Based in Sydney, Kieran Davies is Chief Macro Strategist at Coolabah Capital Investments, an asset manager with 40 executives and over $8 billion in fixed-income strategies. Kieran is responsible for macroeconomic research and investment strategy,...
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