5 Nov 2015

Economic data points to softening conditions

10:47 am on 5 November 2015

A flurry of economic numbers yesterday added some weight to the view that conditions have softened and the economy faces some headwinds.

New Zealand money.

New Zealand money. Photo: RNZ / Alexander Robertson

Labour market data showed the economy lost 11,000 jobs in the third quarter, while the unemployment rate nudged up to six percent, and there were signs that people may be giving up on looking for work.

Meanwhile, wages growth was steady and subdued, the latest dairy auction saw prices fall for a second consecutive sale, stalling the rebound of the previous two months, and property numbers out of Auckland pointed to that market losing some steam.

Bank of New Zealand senior economist Craig Ebert said we should not read too much into a diverse set of numbers, although taken together the data offered a bit of weight to the case for a rate cut in December.

The New Zealand dollar was knocked about a bit, losing nearly three quarters of a cent at one stage, on the combined impact of the softer dairy and jobs numbers.

Mr Ebert said the currency's move was a reminder that it was a release mechanism and the trend had been lower.