Anna Breman expressed her displeasure at the growing inflation expectations among economic analysts and businesses. She emphasized the difficulty firms would face in raising prices, especially with subdued wage growth and a slowly improving job market.
During a Business Canterbury event in Christchurch, Breman highlighted the challenges households were facing due to the high cost of living and a weak job market. She pointed out that higher prices would further burden consumer spending.
Additionally, Breman cautioned about potential volatility stemming from geopolitical tensions and advancements in artificial intelligence, which could impact inflation unexpectedly.
While the Monetary Policy Committee remains vigilant of these risks, it will not react excessively to short-term fluctuations.
