New Zealand Q3 CPI has just been released, and it’s come in hotter-than-expected.
During the quarter prices rose by 0.3%, below the 0.4% gain of Q2 but higher than the median market forecast for an increase of 0.2%.
The above-consensus quarterly print left the annual rate of inflation at 0.4%, higher than the 0.1% level of Q2 and expectations for an increase of 0.3%.
While both reading were above expectations, the annual rate remains below the 1-3% inflation range targeted by the RBNZ.
Tradable inflation, that influenced by offshore factors, decreased 1.2% while non-tradable inflation, or domestically-orientated price movements, rose by 1.5%. The annual increase in non-tradable inflation was the lowest recorded since the december quarter of 2001.
According to Statistics New Zealand, higher housing-related costs offset weakness in petrol prices.
“Housing and household utility prices were up 2.7% in the year,” said Statistics New Zealand’s prices senior manager Chris Pike.
“With higher prices for newly built houses excluding land (up 5.5%), housing rentals (up 2.3%), and local authority rates (up 5.9 %). The annual increase was influenced by housing-related prices, particularly in Auckland.”
Partially offsetting those movements, petrol prices fell by 6.8% from September 2014.
As a result of the hotter-than-expected print, the New Zealand dollar is trading modestly higher as of 9.15am AEDT in Sydney. The NZD/USD currently sits at .6859, an increase of 0.15%.