Inflation surprise means Reserve Bank will have to play catch-up

Late January is often a time of financial regret, as anyone opening a credit card bill in the next fortnight can testify.

The Reserve Bank might be feeling a pang or two of policy remorse as it opened today’s inflation figures. While some of the reaction to the unexpected rise in the consumer prices index has been overdone- it is significant, yes, but it did not warrant a jump of an entire cent in the New Zealand/US exchange rate.

 

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