New Zealand dollar falls: unemployment rate reached as low as 5.9%

New Zealand continues to struggle to maintain its economy to an acceptable standards, which is far below to provide employment and deserving wages.

On Wednesday, the New Zealand dollar declined to a three-week low, which lead to a drastic fall in employment rate higher than expected. This situation prompts Reserve Bank to resemble neighboring Australia to cut its rate at the next meeting, as reported by IBTimes.

The change in employment in the first quarter of this year increased to 0.7% for New Zealand, however, it is lesser from the previous year which is an increase of 1.2% and the trailing market expectations of a 0.8% increase.

According to the Labor Market Statistics for June 2015 quarter, unemployment rete rose to 5.9%. There is a continuous period of growth for the annual employment, but quarterly growth falls behind working-age population growth. Also, the participation rate of labor force fell to 0.2% points, after a record high in March quarter. The inflation for annual wage is at 1.6%. Lastly, the total working hours were down to 0.6% (up to 2% in March quarter).

Forex Crunch stated that NZD/USD tried to regain its economic standards before the publication, but it decreased instead. RBNZ maintained the ranges unchanged at 2.7% but shows its desire for a weaker currency.

New Zealand is facing strong punches on the economy for the last few years, with its employment rate not coping up with continues increase in workforce produced. As the government is trying hard to increase the job opportunities in Canterbury, but the percentage raise is being slammed continuously because of 'slowing economy'. Auckland is becoming the center of jobs opportunities, hitting mostly on construction category. Dairy auction prices plunged to 7.4%, only followed by business and consumer confidence.

Westpac senior economist Satish Ranchhod said, "We expect the economy is going to need a significant shot in the arm to boost activity and inflation".

An informetric said that with already two cuts in interest this year, the government is expecting further cut down, in account of weakening economy, high unemployment rate and lower wage rate.