- RBNZ survey
New Zealand's producer prices fell in the second quarter as diary prices declined, while input prices were also lower amid cheaper electricity costs and dairy manufacturing input costs. As a result the New Zealand Dollar lost versus its American counterpart as the report added to signs that the nation's economy may have started to slow, providing room for revising interest rate outlook. The output PPI, which measures the prices fetched by producers at the factory gate, declined 0.5% in the June quarter, according to Statistics New Zealand, partly reversing a 0.9% increase in the previous three-month period. Input PPI, which measures the change in costs of components used in the production process, dropped 1.0% in the April-June period, following a 1.0% surge in the first quarter. On top of that, the Kiwi Dollar faced even more downward pressure after the data showed expectations of CPI inflation, GDP growth as well as the New Zealand Dollar exchange rate declining, sending the Kiwi dollar back near its recent two-month low against the U.S. Dollar. CPI is seen rising at an annual 1.96%, down from the 2.08% rate three months ago, while two-year expectations decline to 2.23% from 2.36%. The NZD/USD exchange rate is expected to decline to 0.83 by the end of this year and to 0.80 in the next six months. One-year expectations for GDP growth have dropped from 3.3% to 3.1%, and on the two-year horizon, the annual growth expectations have fallen from 2.9%
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