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Inflation Expectations Moderate Further In Q2

NEW ZEALAND

Inflation continued to trend in the right direction with RBNZ 2-year business inflation expectations moderating to 2.3% in Q2 from 2.5%, the lowest since Q3 2021. 1-year out declined by more falling to 2.7% from 3.2%, the lowest in three years. Household inflation expectations have been running higher than business ones and Q2 for this survey will be published on May 20. Research by RBNZ has shown that mean 1-year ahead inflation expectations have had the best relationship with inflation. Both businesses and households are signalling that the CPI is heading to the target band.

New Zealand RBNZ core CPI y/y% vs inflation expectations %

Source: MNI - Market News/Refinitiv

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