(Bloomberg) -- New Zealand inflation unexpectedly slowed in the third quarter as fuel prices failed to recover.
Consumer prices rose 1.4% from a year earlier, Statistics New Zealand said Friday in Wellington. That compared with 1.5% in the second quarter, and was less than the 1.7% expected by economists. Prices rose 0.7% from three months earlier, less that the 0.9% forecast.
Inflation is set to weaken markedly next year as a sluggish economic recovery and rising unemployment exert downward pressure on wages and consumer spending. The Reserve Bank in August projected inflation would slow to just 0.3% by the end of 2021, and has signaled it is prepared to provide more stimulus through negative interest rates if needed. It targets inflation of 1-3%.
The New Zealand dollar fell after the report, buying 66.69 U.S. cents at 10:57 a.m. in Wellington.
©2020 Bloomberg L.P.
