New Zealand’s shopper costs rose to three.0% y/y within the September 2025 quarter, reaching the higher restrict of the Reserve Financial institution’s 1-3% goal vary.
The quarterly enhance of 1.0% doubled the tempo from Q2’s 0.5% rise, pushed primarily by surging electrical energy prices and native authorities charges.
The headline determine matched each the Reserve Financial institution of New Zealand’s (RBNZ) August forecast and market expectations, offering little shock for merchants.
Regardless of touching the three% ceiling, underlying inflation metrics provided reassurance – non-tradeable inflation decelerated to three.5% from 3.7%, whereas core CPI excluding meals, vitality, and gasoline held regular at 2.5%.
Key Takeaways
- Annual inflation accelerated to three.0%, hitting the highest of RBNZ’s goal band
- Quarterly CPI rose 1.0%, doubling the earlier quarter’s 0.5% acquire
- Electrical energy costs surged 11.3% yearly – the very best since 1989
- Non-tradeable inflation eased to three.5% from 3.7%, displaying cooling home pressures
- Core inflation measures remained contained at round 2.5%
Hyperlink to official New Zealand Q3 2025 CPI
The standout contributor was electrical energy costs, which soared 11.3% yearly – marking the steepest enhance since 1989. This single part accounted for 10.1% of the general 3.0% annual inflation price. Native authority charges jumped 8.8%, whereas rents rose a extra modest 2.6% – the smallest annual enhance in over 4 years.
On the constructive aspect, pharmaceutical merchandise plunged 10.6% year-over-year and telecommunications tools dropped 15.2%, offering significant offsets to the broad-based worth pressures.
Market Reactions
New Zealand Greenback vs. Main Currencies: 5-min
Overlay of NZD vs. Main Currencies Chart by TradingView
The New Zealand greenback jumped early within the week after the weekend CPI report confirmed headline inflation doubling for the quarter.
However the comdoll rapidly steadied as soon as China and Hong Kong markets opened, presumably as merchants shifted their focus to the improved threat temper sparked by Trump’s Friday remarks on China tariffs.
The shortage of follow-through possible displays that the CPI figures had been according to RBNZ expectations, underlying pressures continued to ease, and markets had been already positioned for one more price minimize.
Even so, NZD continues to be buying and selling larger throughout the board, posting its strongest positive aspects towards USD and CAD, whereas advances towards EUR and JPY stay modest.
