New Zealand’s central bank has warned that ongoing rises in global oil prices could see near-term inflation rise beyond previous forecasts, adding to risks facing the country’s economic recovery.
Reserve Bank of New Zealand Gov, in notes from a speech in Dunedin on Tuesday, Anna Breman said the recent rise in oil prices and higher long-term interest rates reflected a challenging global environment.
“If higher oil prices persist, they are expected to result in somewhat higher near-term inflation than we assumed in the September statement,” Breman said, according to Reuters.
The RBNZ raised its official cash rate by 25 bps to 2.75% at its September policy meeting. It predicted annual consumer price inflation would ease to 3.9% in the September quarter from 4.1% in the previous quarter.
The economic recovery was expected to strengthen, supported by exports and a gradual rise in household spending, Breman said.
Ahead of its next policy decision on Oct. The bank will mull over incoming economic data and world developments. 28, said Breman.
