Video | Agriculture | Confidence | Economy | Energy | Employment | Finance | Media | Property | RBNZ | Science | SOEs | Tax | Technology | Telecoms | Tourism | Transport | Search

 


NZ inflation expectations dwindle as shine taken off economy

NZ inflation expectations dwindle as shine taken off economic growth

By Jonathan Underhill

Aug. 19 (BusinessDesk) - New Zealand businesses see a tamer track for inflation over the next two years as they trim their expectations for economic growth, suggesting the central bank doesn't have to rush to raise interest rates again.

The consumers price index is seen rising at an annual 1.96 percent on a mean basis in the year ahead, down from the 2.08 percent rate seen three months ago, according to the Reserve Bank's survey of expectations. Two-year inflation expectations fell to 2.23 percent from 2.36 percent.

For the September quarter, CPI is seen rising 0.5 percent, down from 0.59 percent last quarter. Inflation is seen slowing to 0.36 percent in the fourth quarter of the year.

Businesses see less inflation in an economy that may not be growing as fast as expected. The one-year ahead expectation for gross domestic product was trimmed to 3.1 percent from 3.3 percent and two years out the annual pace is seen slowing to 2.7 percent from 2.9 percent.

The survey comes after the release of the Treasury's pre-election fiscal and economic update, which also points to a slower pace of growth. The Treasury cuts its forecast for GDP in the year ending March 31, 2015, to 3.8 percent from its 4 percent forecast in the May budget, citing weaker commodity prices and tamer inflation.

The RBNZ survey shows one-year-ahead expectations for hourly earnings growth fell to 2.6 percent from 2.9 percent, while the two-year series fell 0.3 percentage points to 2.8 percent. Unemployment one year ahead is seen at 5.5 percent, down 0.1 percentage point from the second quarter, while the two-year-ahead rate held at 5.3 percent.

The survey was conducted on August 6-7 and was of 83 business managers and professionals.

(BusinessDesk)

© Scoop Media

 
 
 
 
 
Business Headlines | Sci-Tech Headlines

 

Final Frontier: Rocket Lab And NASA Sign Commercial Space Launch Agreement

Rocket Lab has signed a Commercial Space Launch Act Agreement with the National Aeronautics and Space Administration (NASA). The agreement enables Rocket Lab to use NASA resources - including personnel, facilities and equipment - for launch and reentry efforts. More>>

ALSO:

Scoop Business: Wheeler Downplays Scope For ‘Large’ Rates Fall

Reserve Bank governor Graeme Wheeler says some market commentators are predicting further declines in interest rates that would only make sense for an economy in recession, although some easing is likely to be needed to maintain New Zealand’s economic growth. More>>

ALSO:

Ruataniwha Dam: Consent Conditions Could Mean Reduced Intensity

Legal advice sought by the Hawke’s Bay Regional Council on the Ruataniwha Dam consent conditions has confirmed that farmers who sign up to take water from the dam could be required to reduce the intensity of their farming operation to meet the catchment’s strict nitrogen limit. More>>

Health And Safety: Bill Now Sees Rules Relaxed For Small Businesses

Health and safety law reform sparked by the Pike River coalmine disaster has been reported back from the industrial relations select committee with weakened requirements on small businesses to appoint health and safety representatives and committees. More>>

ALSO:

Bearing Fruit: Annual Fruit Exports Hit $2 Billion For First Time

The value of fruit exported rose 20 percent (up $330 million) for the June 2015 year when compared with the year ended June 2014. Both higher prices and a greater quantity of exports (up 9.0 percent) contributed to the overall rise. More>>

ALSO:

Get More From Scoop

 
 
 
 
 
 
 
 
 
Business
Search Scoop  
 
 
Powered by Vodafone
NZ independent news