New Zealand's unemployment rate will peak sooner and at a much lower level than originally forecast, according to a senior government official.

Finance minister Bill English suggested that the country's jobless rate is unlikely to reach the treasury's September prediction of 7.5 per cent as the economy begins to move out of recession, Reuters reported.

These comments were made ahead of the release of unemployment data tomorrow (November 5th), which Reuters predicted would rise to 6.4 per cent of the labor market.

According to the news agency, Mr English remains optimistic that the employment situation is moderating.

He said: "We are seeing some welcome early signs of New Zealand moving out of recession and we expect this will see unemployment peaking next year lower and sooner than previously forecast."

Yesterday (November 3rd), Statistics New Zealand released its labor costs index, which disclosed that wages rose in the third quarter of 2009 as the economy emerged from the financial downturn.