Statistics NZ said the number of unemployed New Zealanders kept climbing during the December quarter, jumping 18,000 to reach 168,000. New Zealand, which recorded an unemployment rate of 7.3 per cent for the December quarter, is still not doing too badly when compared with the rest of the world. The Reserve Bank of New Zealand (RBNZ) was expecting an unemployment rate of 6.6 percent, while the market was expecting 6.8 percent.
The NZ dollar fell to a five month low of US69.60c from US70.80c just before the report. It was at US69.80c at 5pm from US71.06c at the same time yesterday. The higher than expected increase in unemployment means interest rates may remain lower for longer, which makes the NZ dollar less attractive to investors.
The Government says a leap in the population is behind unemployment levels reaching their highest level since 1999. The jump in the unemployment rate was largely due to an increase in the number of people entering the labour force but who were unable to find work. There were 341,300 visitors in December, the highest ever recorded in one month, and a 6 per cent increase over the previous record of 322,200 in December 2008.