New Zealand: producer prices tanked in 3Q; RBNZ to tighten policy mid-2010

* Producer prices fell sharply in 3Q
* Falling dairy prices largely to blame
* RBNZ to hold off policy tightening until mid-2010

Producer prices in New Zealand fell sharply in the third quarter, owing to falling dairy prices. Input prices tanked 1.1%q/q (J.P. Morgan -0.3%, consensus: 0.0%) owing to the stronger NZ dollar, which was up 12% against USD over the quarter. Output prices were down 1.4%q/q (J.P. Morgan: -0.5%, consensus: 0.2%), double the rate of decline recorded in the June quarter.

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ENDS