Inflationary pressures in New Zealand, moderate, RBNZ is unlikely to tighten now.

The index of food prices New Zealand fell in August on 0,1%, according to a release issued Monday. The previous month it rose by 1,6%, and in June added another 1.3%. Nevertheless, the previous fall was so strong that the annual terms, prices are only now matched to the level recorded a year earlier. Despite the fact that food prices are very volatile and often taken out of the estimated control inflation, still help to provide better overall inflationary condition in the country, as the overall CPI is published only on a quarterly basis.
So, we have a very neutral inflationary pressures, allowing RBNZ did not rush to tighter monetary policy by copying the actions of its big neighbor - Australia. This Thursday, a regular meeting of the Reserve Bank's rate. It is expected to be retained unchanged at 3.0% following an increase in late July by a quarter percentage point to 3.0%. In general, we are of the opinion that the RBNZ will try as long as possible to keep the rate low to reduce the interest carry trade'rov. On that part of the tightening of monetary policy would take fiscal measures, said about a year ago. In all probability, continue to remain the trend of the monetary authorities not to attract attention to the kiwi as a profitable currency that will not support the growth rate during the boom and prevent collapse in times of crisis.

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