Inflation in New Zealand for July to September 2018, the third quarter of the year

0.9 % q/q - higher than expected

  • expected 0.7% q/q, prior 0.4%

1.9 % y/y - higher than expected

  • expected 1.7% y/y, prior 1.5%

Well, that's an interesting result.

Inflation edging a little higher and more than expected. Expectations of any kiwi rate cut (which was not a strong possibility but it had been murmured) will be trimmed back on this.

NZD/USD up a few points on the release, some shorts getting cut.

More (via Stats NZ):

  • "Petrol prices increased 19 percent in the September 2018 year," prices senior manager Paul Pascoe said. "This is the highest annual increase since June 2011."
  • "While petrol only makes up about 4 percent of the CPI, it can have a large impact on overall inflation,"
  • "It contributed about 30 percent to the quarterly CPI movement for September, and about 40 percent to the annual movement."
  • the first time petrol prices have risen for four consecutive quarters since September 2008
  • When petrol is removed from the CPI, the increase was 0.7 percent for the September 2018 quarter (compared with 0.9 percent overall), and 1.2 percent for the September 2018 year (compared with 1.9 percent overall).

With the fuel price increase playing such a big role in the higher than expected, eyes will now turn to the later data (RBNZ model, see below) for a better idea on core inflation.

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Stay tuned (or come back later) for the RBNZ's own preferred measure of inlfaiton, their sector model (more here) . Due at 0200 GMT.

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for background to the inflation data for NZ Q3: