Liz Kendall, senior economist at ANZ, expects New Zealand’s headline CPI to be flat in the December quarter, and expects annual inflation to slip from 1.9% to 1.8%.
Key Quotes
“Tradable inflation is expected to print at -0.8% q/q, while non-tradable inflation is expected to post a 0.4% q/q rise. We expect that measures of core inflation will track broadly sideways.”
“CPI in line with our expectations would add to the case we see building for a more dovish stance by the RBNZ in February. The RBNZ may take a degree of comfort from the fact that Q4 weakness is expected to be concentrated in tradable inflation. But the medium-term outlook for domestic inflation is more troubling. The RBNZ needs to see accelerating GDP growth to achieve a sustained lift in inflation, and the prospect of that is slipping away.”
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