When is NZ’s jobs data and how might it affect NZD/USD?

• New Zealand jobs data arrives today ahead of the US elections.
• NZD/USD is firm on expectations of Biden victory.

While taking a back seat to the US elections for the day ahead, and not normally such a market-moving event, today’s New Zealand jobs data released at 21.45 GMT could otherwise draw some unusual attention. 

What will be encouraging is if both the Employment and Unemployment numbers beat the expectations to some degree.

Employment is expected to fall and the Unemployment rate to rise. 

However, there is a divergence between the nation’s covid spread to that of Europe’s and the US with no political uncertainty either.

This puts the Kiwi in good stead comparatively, so data such as today’s jobs numbers should be more compelling than usual. 

Wage subsidies, with some firms still dependent on these supports over Q3 will be included in today’s data which may have reduced or delayed job losses by more than the market was expecting. Moreover, volatility in the data is also expected, given disruption and measurement difficulties seen last quarter, according to analysis at ANZ Bank. 

”With challenging times ahead and temporary supports rolling off, we expect the labour market to deteriorate further. But for now, the picture could have been much worse,” they argued.

Stats NZ’s monthly employment indicator, on a quarterly basis, indicates a 1% drop in filled jobs in the June quarter, followed by a 0.7% rise in the September quarter.

In contrast, the June quarter HLFS showed only a 0.3% drop in employment, so it’s less likely that we’ll see a bounce in the September quarter figures according to analysts at Westpac.

”The MEI is another indication of the New Zealand economy’s resilience as it has moved past the Covid lockdown,” analysts at Westpac explained.

”The restrictions that were temporarily re-introduced in August, with Auckland moving to Alert Level 3 and the rest of the country to Level 2, appear to have had little impact on the labour market.”

”Filled jobs continued to rise in that time, and Auckland only slightly underperformed – up 0.4% on a year ago compared to 0.9% nationwide.”

Kiwi implications

NZD/USD has been trading around 0.67, having rallied on broad USD weakness and a spike in risk appetite in anticipation of a Job Biden and Democratic Party victory in today’s US elections. 

On an inline jobs report, it is unlikely that the kiwi will react, but bracing for a surprise, there could be room for a significant test of the 0.6720 if the data beats expectations with sights of 0.6760 in anticipation of a Biden victory later in the day. 

”But stepping back, the RBA’s easing yesterday, general caution and commitment not to hike for 3 years is a reminder that the RBNZ will also be very dovish next week, and that should keep rates down,” analysts at ANZ bank argued. 

About the Employment Change 

The Employment Change released by the Statistics New Zealand is a measure of the change in the number of employed people in New Zealand.

Generally speaking, a rise in this indicator has positive implications for consumer spending which stimulates economic growth.

A high reading is seen as positive (or bullish) for the NZ dollar, while a low reading is seen as negative (or bearish).