LONDON: The New Zealand dollar fell to a three-week low against the greenback and a three-month low versus its Australian counterpart after local wage growth slowed in the March quarter, raising the prospect of a rate cut by the Reserve Bank.
Employment change in the first quarter of this year was a 0.7% increase for New Zealand, much less than previous quarter’s 1.2% increase and trailing market expectations of a 0.8% rise.
The unemployment rate stood at 5.8% as the Q4 rate was revised up to the same level from 5.7% in prior reading and against the market consensus of a drop to 5.5%.
The growth in the labour cost index too declined to 0.3% from 0.5% when the consensus was for 0.4%.
NZD/USD fell to 0.7459, its lowest since 14 April, from the previous close of 0.7559.
The Kiwi dollar had ended April at 1.9% higher, but in less than a week in May, the currency declined more than 2%, entirely reversing the previous month’s gains.
