New Zealand inflation jumped at the fastest rate in a decade in the third quarter of 2021, reinforcing bets that the central bank will keep increasing borrowing costs. Data from Statistics New Zealand showed on Monday that the annual inflation rate surged from 3.3% to 4.9% in July-September, beating analysts’ estimates for 4.2%.
Consumer prices advanced 2.2% from the second quarter, the largest quarterly increase since the fourth quarter of 2010 and exceeding economists’ expectations for 1.5%. Ten of the 11 main groups in the consumers' price index (CPI) basket saw increases in the last quarter. Housing-related costs, such as construction, were the main driver in the price increase, the statistics agency said.
Following the report, New Zealand’s currency strengthened to 71 US cents at 11:30 in Wellington, while the yield on the country’s ten-year bond rose 11 basis points to 2.39%, the highest level in nearly three years. The Reserve Bank of New Zealand raised its benchmark interest rates on October 6 and has signalled for further rate hikes as it seeks to maintain inflation around the midpoint of its 1-3% target range.
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Published on October 18, 2021 12:06 PM (GMT+8)Last Updated on October 18, 2021 12:06 PM (GMT+8)
