NZ: Monthly Inflation Gauge dipped 0.1% in March- ANZ

New Zealand’s ANZ Monthly Inflation Gauge dipped 0.1% m/m in March, but strength in the early months of the year took the quarterly increase to 1.1% for Q1, points out the research team at ANZ.

Key Quotes

“The Gauge has given a very accurate read on non-tradable inflation in the last two CPI prints.”

“Overall, 10 of the 36 subcomponents rose in March, while 6 subcomponents fell. Housing-related prices were strong in the month, with rents, purchase of housing, and property maintenance services among the top contributors. On the downside, telecommunications and accommodation services were a drag.”

“Annual growth rose to 2.4%, towards a level more consistent with Statistics NZ’s annual non-tradable numbers. Excluding housing-related prices, the Gauge fell 0.2% m/m, pushing annual growth up to 0.8% from 0.5%.”

“Waning momentum in the economy means inflation pressures will soon fade. However, we could see some further strength in annual non-tradable inflation in the short term as a result of the previous build-up in capacity pressures.”