The last pieces of major economic data before the Reserve Bank's Monetary Policy Statement next week will be the first-quarter employment figures tomorrow, the GlobalDairyTrade auction, also tomorrow, an expected QVNZ housing report, ANZ Job Ads and the Reserve Bank two-year inflation expectations, on Friday.
ASB chief economist Nick Tuffley said New Zealand's booming economy was creating enough jobs to comfortably absorb the additional job hunters.
Meanwhile, the Reserve Bank would want wage inflation to increase in the coming year, supported by increased inflation expectations and the tighter labour market.
On Friday, the Reserve Bank's survey of expectations was likely to show a lift in inflation expectations, following the rise in petrol prices and the stronger-than-expected lift in consumer price index inflation, he said.
``While the market is likely to be sensitive to these releases, we expect the Reserve Bank will be less so.''
The Reserve Bank was next week likely to remain ``staunchly'' on hold, keeping its official cash rate at 1.75% for at least another year, or longer, Mr Tuffley said.
Craigs Investment Partners broker Chris Timms said the dairy trade auction results would create some interest. At the last auction, the headline GDT index was up 3.1% for its third consecutive month. Whole milk powder prices rose 3.5%.
Although prices were still below December levels, they had bounced nearly 7% since early March.
The Reserve Bank of Australia meet at 4.30pm today and the United States Federal Reserve decision will be released early Thursday, New Zealand time.
``Markets see virtually no chance of any movement from the RBA, which releases its quarterly statement on monetary policy on Friday.
``For the Fed, which will obviously attract much more interest, markets are only pricing a 13% chance of a rate hike. This rises to 70% for the next meeting in mid-June, which is widely tipped to see the next rate hike from the FEd.''
There would be no updated economic projections or press conference this time and markets would only have the brief statement to work with, he said.
The global reporting season continued this week. Some of the 150 Standard & Poor's 500 companies to report included Berkshire Hathaway, FMC, Apple, CVS Health, Shire, Ecolab, Southern Company, Facebook, Kirby and Tesla.
The earnings season was more than half-way through and would be largely complete at the end of this week. Of the 287 S&P500 companies to so far report, 65% had beaten sales forecasts and 80% had exceeded earnings estimates, Mr Timms said.
