Reported about 1 year ago
New Zealand's Reserve Bank expects inflation to keep decreasing due to factors like increasing spare capacity, declining inflation expectations, and the anticipation of lower domestically generated inflation. Chief Economist Paul Conway mentioned the need for a restrictive policy period to ensure inflation returns to the 1-3% target range. Despite a previous forecast of not cutting the Official Cash Rate until the third quarter of next year, economists predict a possible pivot sooner. The struggling economy, with recent contractions, is expected to start showing spare capacity in 2024, leading to lower inflation, supported by recent RBNZ research.
Source: YAHOO