Oil Price Surge Sparks Inflation Concerns for NZ Economy
The Reserve Bank of New Zealand Governor, Dr Anna Breman, has warned that near-term inflation could be higher than forecast if high oil prices persist. She made this statement during a visit to Dunedin, where she addressed the economic outlook.
According to the recent GDP figures, economic growth was 0.2 percent in the three months to June, despite the effects of high oil prices and other global headwinds. Dr Breman noted that while the recovery is being felt unevenly across the country, there are signs of growth, particularly in the South Island.
The Governor emphasized that recent increases in global oil prices have raised concerns about inflation. She stated that if higher oil prices persist, they could result in somewhat higher near-term inflation than assumed in the September Statement.
Oil prices have surged above US$100 a barrel in recent weeks, with pump prices in New Zealand hitting levels last seen in June. The current price of 91 unleaded on the Gaspy fuel monitoring site is $3.34 a litre.