New Zealand Q2 employment report favors NZD/USD bears

Statistics New Zealand unveils the second quarter (Q2) 2023 employment report around 22:45 GMT on Tuesday to entertain the NZD/USD traders. The headline results are as follows:

• New Zealand Unemployment Rate Q2: 3.6% (estimated 3.5%; previous 3.4%).
• Employment Change (QoQ) Q2: 1.0% (expected 0.5%; prior 0.8%).
• Labor Cost Index (QoQ) Q2: 1.1% (market forecasts 1.2%; prior 0.9%).
• Participation Rate Q2: 72.4% (anticipated to remain unchanged at 72.0%).

NZD/USD reaction

Following the key New Zealand (NZ) Q2 employment report, the NZD/USD pair drops around 30 pips to refresh the intraday low near 0.6140, reversing late Tuesday’s corrective bounce after posting the biggest daily loss in over a week.

It’s worth noting that the US government’s rating cut by Fitch Ratings triggered the broad US Dollar pullback and allowed the Kiwi pair to post a corrective bounce to 0.6175.

Also read: New Zealand Q2 employment report favors NZD/USD bears

However, the mixed NZ data and fears of policy pivot in the Pacific zone, after the Reserve Bank of Australia’s (RBA) rate hike pause the previous day, exert downside pressure on the NZD/USD pair.

NZD/USD 15-minute chart

Also read: NZD/USD Price Analysis: Kiwi trades weak, ahead of Q2 employment data

About New Zealand Unemployment Rate and Employment Change

The quarterly report on New Zealand's Unemployment Rate and Employment Change is being released by Statistics New Zealand.

The Unemployment Rate is the number of unemployed workers divided by the total civilian labor force. If the rate is up, it indicates a lack of expansion within the New Zealand labor market. As a result, a rise leads to weaken the New Zealand economy. A decrease of the figure is seen as positive (or bullish) for the NZD, while an increase is seen as negative (or bearish).

On the other hand, Employment Change 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).