The Reserve Bank of Australia increased its cash rate, as expected, by 25 basis points to 4.1%, saying there is a material risk that inflation will remain above target longer than previously anticipated.
“The conflict in the Middle East has resulted in sharply higher fuel prices, which, if sustained, will add to inflation. Short-term measures of inflation expectations have already risen,” the bank said.
“Higher prices and prolonged uncertainty may cause growth to be lower in Australia’s major trading partners and also in Australia.”
International lens
Mark Lister, investment director with Craigs Investment Partners, said the US Federal Reserve, European Central Bank and the Banks of Japan and England were also meeting this week.
“All eyes will be on their views of the rising oil price and impact on inflation, and markets are treading water and guided by international signals.”
Lister said the big cash rate differential of 4.1% and 2.25% in New Zealand will likely result in the kiwi softening even further. It was already at its lowest level against the Australian dollar since 2013.
By the end of the day the New Zealand dollar was steady at A82.6c against the Australian.
The oil price was also steady, with Brent crude trading at US$102.70 ($175.95) a barrel, up 2.5% for the day.
ANZ Research said the Selected Price Indexes for February were a touch stronger than expected, and its first-quarter consumer price (CPI) index forecast of an 0.6% increase was “tilted slightly to the upside”.
Impact ‘still to come’
The bulk of the impact from the oil price shock, assuming it is sustained, will fall in the second-quarter CPI, ANZ said.
Market leader Fisher & Paykel Healthcare gained 28c to $38.63; Meridian Energy was up 9c to $5.47; Vista Group added 4.5c or 2.49% to $1.85; Seeka increased 10c or 1.85% to $5.50; and NZME collected 2c or 1.79% to $1.14.
Mercury Energy, up 5c to $6.45, has opened the fifth renewable energy generation unit at its Ngā Tamariki geothermal station near Taupō at a cost of $220m. The new unit lifts the station’s annual average generation to 1120GWh, enough to power all residential homes in Christchurch.
Mercury said the Ngā Tamariki expansion will help deliver 3.5 terawatt-hours of new generation by 2030 – about 8% of New Zealand’s annual energy demand.
My Food Bag increased 3c or 15% to 23c after reporting increased sales in the second half of the 2026 financial year and forecasting full-year net profit of $6.4m-$6.8m, above the previous year’s $6.3m.
Revenue growth is expected to be 6% for the half-year and 4.9% for the 12 months ending March, My Food Bag said.
Ebos Group was down 39c or 1.72% to $22.25; Mainfreight declined $1.50 or 2.39% to $61.30; Freightways eased 15c to $13; Skellerup shed 14c or 2.48% to $5.50; and Ryman Healthcare was down 5c or 2.16% to $2.26.
Tourism Holdings declined 11c or 4.91% to $2.13; Serko shed 11.5c or 5.81% to $1.865; Turners Automotive decreased 18c or 2.15% to $8.21; Sky TV fell 14c or 4.39% to $3.05; and Winton Land was down 6c or 2.94% to $1.98.
Property stocks
In the property sector, Kiwi was down 2c or 2.11% to 93c, and Precinct decreased 2.5c or 2.27% to $1.075.
Among the mining stocks, Santana Minerals was up 3c or 3.19% to 97c, and Rua Gold declined 6c or 3.23% to $1.80.
Taiko Critical Minerals, down 0.005c or 2.04% to 24c, was back trading after retracting its financial model for the West Coast Barrytown project.
NZX supervisor NZ RegCo indicated that the independent adviser who prepared the model did not meet the definition of a competent person under the joint ore reserves committee code.
Manuka Resources, unchanged at 13.9c, reported a $12.87m loss for the six months ending December compared with an $8.37m loss in the previous corresponding period. The miner has $11.1m in cash and an additional $9.3m in short-term liquidity.
Manuka Resources said it was considering a number of options to progress the final environmental approvals for the Taranaki vanadium project. The marine and discharge consents were declined by an expert panel.
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