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1-Year Inflation Expectations Ease To Lowest Since End-2021

NEW ZEALAND

Business inflation expectations for Q3 are unlikely to shift the RBNZ from its neutral stance. The expected CPI one year out is expected to rise 4.2% down from 4.3% in Q2 and off the peak of 5.1% in Q1. It is the lowest reading since Q4 2021. Two years ahead was steady at 2.8%. Both 1 year ahead business and household inflation expectations have high correlations with headline and core CPI and so are useful price indicators, but the consumer measure has been stickier this year.


NZ Inflation expectations vs CPI y/y%

Source: MNI - Market News/Refinitiv

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