Inflation in New Zealand has been dropping back as domestic demand has cooled. However, that softening is occurring more gradually than the RBNZ has been expecting. Importantly, a hard ‘sticky’ core of domestic inflation pressures means a return to 2% inflation is still a long way off. Against that backdrop, the RBNZ is set to leave the Official Cash Rate on hold over the remainder of this year. New Zealand consumer prices rose 0.6% in the first three months of the year. That saw annual inflation dropping from 4.7% at the end of last year to 4% now. That’s the lowest annual inflation has been since June 2021. The ... (full story)