Inflation at 5 year High

Inflation at 5 year High

Consumer prices rose by more than market and Reserve Bank forecasts in the June quarter. Annual inflation hit a 21-year high of 5.3%.

The main culprits are petrol and travel costs.

World oil prices were a major contributor, with strong gains in petrol and airfares.

Westpac’s chief economist Dominick Stephens says “The RBNZ can look through the current high headline rate, but will be increasingly concerned that actual and expected inflation are likely to remain high once one-off government charges have dropped out of the equation.

“This is one more domestic factor putting pressure on the RBNZ to resume OCR hikes this year.”

For all the details, market reaction and impact on the NZ dollar go to www.headliner.co.nz

ENDS

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