NEW ZEALAND: VIEW: Westpac Sees “Mixed” Labour Market Results For The RBNZ
May-07 01:55
Q1 labour market data printed slightly better than the RBNZ projected in February but still in line with broad expectations. The unemployment rate was steady at 5.1%, while the RBNZ expected a 0.1pp increase, employment rose 0.1% q/q compared to a flat projection and private labour costs rose 0.4% q/q, which were 0.2pp below the RBNZ’s forecast. Westpac sees the implications for the RBNZ as “mixed”.
- Westpac observes that there has been “a marked drop in youth participation in particular in recent quarters, with the tougher jobs market seeing young people returning to or spending longer in study rather than actively looking for work.”
- “The small rise in employment was almost in line with the 0.2% rise in the working-age population (less than the 0.3% that we had assumed). A further drop in the labour force participation rate accounted for the remainder, leaving the unemployment rate unchanged.”
- “The public sector LCI rose by 0.9%, led by a collective pay agreement for teachers. On an annual basis, the private sector LCI slowed from 2.9% to 2.5%.”
- “The analytical unadjusted LCI, which includes pay increases that are related to higher productivity, rose by 0.7% for the private sector, the smallest quarterly rise since December 2020. Fewer roles have seen pay increases over the last year, and the average size of those increases has moderated.”
Want to read more?
Find more articles and bullets on these widgets:
Historical bullets
ASIA STOCKS: Korea’s Outflows Intensify.
Apr-07 01:49
Global Investors continue to withdraw from Korea with another day of significant outflow alongside Thailand.
- South Korea: Recorded outflows of -$1,283m Friday, bringing the 5-day total to -$4,436m. 2025 to date flows are -$8,530, m. The 5-day average is -$887m, the 20-day average is -$225m and the 100-day average of -$132m.
- Taiwan: Had inflows of +$19m as of the 2nd, with total outflows of -$3,124m over the past 5 days. YTD flows are negative at -$18,247. The 5-day average is -$625m, the 20-day average of -$505m and the 100-day average of -$256m.
- India: Had outflows of -$345m as of 3rd, with total inflows of $24m over the past 5 days. YTD flows are negative -$14,006m. The 5-day average is +$5m, the 20-day average of +$15m and the 100-day average of -$143m.
- Indonesia: Had inflows of $38m as of the 27/3, with total inflows of +$54m over the prior five days. YTD flows are negative -$1,830m. The 5-day average is +$11m, the 20-day average -$33m and the 100-day average -$34m
- Thailand: Recorded outflows of -$185m Friday, totaling -$202m over the past 5 days. YTD flows are negative at -$1,331m. The 5-day average is -$40m, the 20-day average of -$34m the 100-day average of -$19m.
- Malaysia: Recorded outflows of -$74m Friday, totaling -$195m over the past 5 days. YTD flows are negative at -$2,338m. The 5-day average is -$39m, the 20-day average of -$54m the 100-day average of -$37m.
- Philippines: Saw outflows of -$13m Friday, with net outflows of -$14m over the past 5 days. YTD flows are negative at -$229m. The 5-day average is -$3m, the 20-day average of +$1m the 100-day average of -$6m.
CHINA: Central Bank Drains Liquidity via OMO.
Apr-07 01:33
- The PBOC issued CNY93.5b of 7-day reverse repo at 1.5% during this morning’s operations.
- Today’s maturities CNY245.2bn
- Net liquidity withdrawal CNY151.7bn.
- The PBOC monitors and maintains liquidity in the interbank market through the issuance of reverse repo.
- The CFETS Pledged Repo Deposit Institutions 7 Day Weighted Average is at 1.53%, from Thursday’s close of 1.69%
- China’s overnight interbank repo rate is 1.79%, from Thursday’s close of 1.70%.
- China’s 7-day interbank repo rate is 1.70%, unchanged.
US TSYS: Cash Bonds Sharply Richer But Off Bests
Apr-07 01:29
TYM5 is stronger at 113-18, +16+ from closing levels in today's Asia-Pac session, but well off today’s high of 114-10.
- According to MNI's technicals team, focus for TYM5 is on technical resistance at 114-16 (2.000 proj of the Jan 13 - Feb 7 - Feb 12 price swing) after having breached round number resistance (114-03.5 high) on Friday.
- Cash US tsys are 4-14bps richer in Asia-Pac session after Friday’s solid gains.
- S&P 500 futures have pared their decline to less than 3% in today's Asia-Pac session from -5.4% earlier.
- Nevertheless, global markets realise that President Trump's tariff policies are not just a US problem and that a US recession has serious implications for global growth. A raft of Asian economies have reached out to the US looking to remove either levies on US imports or open trade talks. However, China unveiled a 34% duty on all US imports. This remains front centre in the minds of market participants as they attempt to digest the implications of this in the Asian session.
- On Friday, March jobs printed higher-than-expected but this gain was tempered slightly by a down-revision to the prior. The latest profile saw 228k after two weak months (111k Jan, 117k Feb) which in turn followed two booming months (261k Nov, 323k Dec).
