Shane Solly, portfolio manager with Harbour Asset Management, said there\u2019s no pull-back in non-tradeable domestic inflation (at 3.5%) with telecommunications equipment and housing stronger.<\/p>\n
People are now talking about the RBNZ bringing forward interest rate rises from early 2027 to late this year, he said.<\/p>\n
\u201cAdding the geopolitical uncertainty to our sticky inflation, and we\u2019ve certainly had a see-sawing week.\u201d<\/p>\n
ANZ, which forecast annual inflation at 3%, said the latest data will make for uncomfortable reading for the RBNZ<\/a>, but indicators of spare capacity suggest there is still some, albeit diminishing, underlying disinflation in the pipeline that should help return headline inflation to within the 1-3% target band.<\/p>\n When combined with the recent sharp improvement in activity data, the latest inflation suggests hikes this year are likelier than not.<\/p>\n ANZ is now forecasting the first 25 basis-point hike in the official cash rate in December, with two follow-up increases in February and April 2027, taking the rate back to an assumed neutral level of 3%.<\/p>\n Bond yields have increased, affecting interest-rate-sensitive stocks on the local market.<\/p>\n The NZ 10 Year Government Bond yield rose to nearly 4.6%, the same level as late July last year and after falling under 4% in October. The 2-year Government Bond yield was up five basis points to 3.3%.<\/p>\n Local stocks<\/p>\n Property stocks were weaker, as was Infratil, down 29c or 2.61% to $10.81, and Spark, decreasing 3c to $2.24.Argosy declined 2.5c or 2.01% to $1.22; Precinct Properties shed 3c or 2.53% to $1.15; Kiwi Property was down 2c or 1.9% to $1.03; and Vital Healthcare Property Trust decreased 4c or 1.98% to $1.98.<\/p>\n Port of Tauranga was down 8c to $7.97; a2 Milk shed 28c or 2.82% to $9.66; Contact Energy decreased 10c to $9.25; Winton Land declined 8c or 3.85% to $2; and 2 Cheap Cars fell 3c or 4.38% to 65.5c.<\/p>\n South Port increased 49c or 5.63% to $9.20; Comvita rose 5c or 8.06% to 67c; Scales Corp gained 11c or 1.95% to $5.76; Steel & Tube was up 2.5c or 3.82% to 68c; and Blackpearl Group added 3c or 3.06% to $1.01.<\/p>\n Vector, unchanged at $4.90, reported a 1.3% increase in electricity volume distributed to 4543GWh for the six months ending December.<\/p>\n In the past year, total electricity connections grew 1.3% to 637,247, but new connections were down 1% for the six months ending December compared with the previous corresponding period.<\/p>\n