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New Zealand Inflation Accelerates to Fastest in 32 Years

  • Inflation came in just shy of estimates, sending yields lower
  • Investors pricing in an 80% chance of half-point hike in May
Vehicles travel along a road in Auckland, New Zealand on April 11.

Vehicles travel along a road in Auckland, New Zealand on April 11.

Photographer: Fiona Goodall/Bloomberg
Updated on

New Zealand inflation accelerated in the first quarter to the fastest pace in 32 years, validating the central bank’s decision to raise interest rates by half a percentage point as it pursues an aggressive tightening cycle. 

Annual inflation surged to 6.9% in the fourth quarter, government data showed Thursday in Wellington. Economists forecast 7.1% and the miss saw bond yields fall, while the currency dropped as much as 0.6%, erasing about half of Wednesday’s gain.