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NEW ZEALAND: Bank desk views on today's NZ Q3 CPI release:
- ANZ: Headline CPI came in stronger than market & our own exp. Non-tradables
was as we expected at 0.8%, with tradables a touch stronger at 0.9%. The suite
of core inflation indicators was broadly stable. The solid CPI print does not
take the possibility of an OCR cut off the table.
- ASB: Both non-tradable & tradable inflation was stronger than we had
anticipated. However, the majority of the surprise was on the tradable side of
the equation, with petrol & airfare costs rising more than anticipated. Looking
through the lift in headline inflation, core measures remained largely unch. As
a result, we don't expect the RBNZ to feel any pressure yet to respond.
- Westpac: Today's result was a substantial surprise relative to the RBNZ's
forecast. The rise in fuel prices since the RBNZ made its forecast will account
for some of this, but not all. Moreover, the more persistent non-tradables
component was also stronger than the RBNZ exp., though we don't know how much of
the surprise was concentrated in a single item. This makes the prospect of
interest rate cuts a more difficult prospect for the RBNZ.
MNI London Bureau | +44 0203-865-3809 |
MNI London Bureau | +44 0203-865-3809 |

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