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The New Zealand’s ANZ Monthly Inflation Gauge rose 0.3% m/m (+2.4% y/y) in June with domestic airfares making the largest contribution (0.12%pts), notes the research team at ANZ.

Key Quotes

“Inflation in the ANZ Monthly Gauge has been tracking sideways after losing momentum earlier in the year.”

“In annual terms, the Gauge was up 2.4% in June, slowing from 3.1% in February and below the 12-month average of 2.7%.”

“At -0.2% q/q, the Gauge implies a weak non-tradables CPI inflation print in Q2 (scheduled to be published on 17 July). While much of this weakness is owing to earlier monthly outturns, June’s bounce back was much smaller than anticipated, and points to downside risks around our previous (and the RBNZ’s May MPS) expectation of 0.3% q/q (2.4% y/y) for non-tradables inflation in Q2.”