Little reaction in the NZD to the NZ Q2........>

KIWI: Little reaction in the NZD to the NZ Q2 labour market report, NZD/USD

trading a tad softer at ~$0.6810.

- The unemployment rate unexpectedly ticked up to 4.5%, as the uptick in the

participation rate outweighed the slightly stronger than expected Q/Q & Y/Y

employment growth. Average hourly earnings were particularly disappointing,

although the private wage metric met expectations.

- This gives the RBNZ's inference re: that "employment is currently within a

broad range of indicators of the maximum sustainable level. Spare capacity in

the labour market appears to have been absorbed, although estimates of capacity

are uncertain." some credence. Although the average hourly earnings print will

provide some concern.