NZ Business Managers See Slowing Inflation Ahead

The Reserve Bank of New Zealand's (RBNZ) quarterly survey of expectations shows business managers expect inflation to slow down. They forecast inflation to be at 2.34% over the next two years, which is a decrease from 2.53% in the previous period.

This marks the lowest reading since Q4 2025 and indicates that businesses are anticipating a slowdown in inflationary pressures. One-year inflation expectations have also moderated, dropping to 2.60%, down from 3.41% in Q1.

However, longer-term expectations have accelerated. Five-year inflation forecasts rose to 2.31% from 2.22%, while ten-year expectations edged up to 2.20% from 2.19%. In terms of monetary policy, respondents expect the Official Cash Rate (OCR) to rise to 2.73% by the end of the September quarter and further to 3.21% over the next year.