ASB Forecasts Q4 Inflation Rebound Driven by Middle East Transport Costs
What happened
New Zealand annual inflation slowed to 3.7% in the third quarter, missing the 3.8% forecast and the Reserve Bank of New Zealand’s 3.9% projection. However, ASB predicts a Q4 inflation rebound, noting that the Middle East war is increasing fuel, fertilizer, and transport costs.
From investinglive.com
Why it matters
Despite the Q3 slowdown, firm core inflation and rising fuel prices suggest a longer tightening cycle. The Middle East conflict is specifically driving up costs, which keeps the risk skewed toward further interest rate hikes by the Reserve Bank of New Zealand.
From investinglive.com
Who's involved
- ASBForecasted the Q4 inflation rebound based on rising costs.
- Middle EastThe geopolitical region whose conflict is cited as lifting fuel and transport costs.
- Reserve Bank of New ZealandThe central bank whose policy outlook is influenced by the inflation data.
Who could feel it
Possible knock-on effectsThese are possibilities Brind reasoned out, not predictions, and not advice. Most are not stated in any report.
- JapanSpeculative
Rising fuel and transport costs might increase the cost of vital energy imports.
- KenyaSpeculative
Rising fuel and transport costs could contribute to supply disruptions and inflation.
- IndiaSpeculative
Rising fuel and transport costs may increase the cost of vital energy and fertilizer imports.
Keep exploring
The entities involved
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ASB
magazine, website
Nothing else this week.
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Middle East
geopolitical region encompassing Egypt and most of Western Asia, including Iran
Related events
- Geopolitical tensions in the Middle East are driving inflation concerns for the ECB, with German and French GDP data influencing hawkish expectations.
- Bangko Sentral ng Pilipinas monitors Middle East developments for inflation implications, with UnionBank economists analyzing the impact on policy targets.
- Operational costs driven by the conflict in the Middle East are causing increases in diesel prices.
- Andrew Hauser discussed Australian inflation issues, noting that the conflict in the Middle East is driving price increases.
- Conflict in the Middle East is driving up energy prices.