New Zealand's (NZ) inflation expectations decline on a two-year time frame for the fourth quarter of 2023 while dropping sharply further for the year ahead, the Reserve Bank of New Zealand’s (RBNZ) latest monetary conditions survey showed on Wednesday

Two-year inflation expectations, seen as the time frame when RBNZ policy action will filter through to prices, eased slightly to 2.76% in Q4 from 2.83% prior.

NZ 2023 average one-year inflation expectations dropped to 3.60% in the quarter to December vs. 4.17% seen in the second quarter of this year. 

Kiwi holds the bounce despite easing inflation expectations

The New Zealand Dollar (NZD) is unperturbed by the falling inflation expectations. At the press time, NZD/USD is keeping its recovery attempt intact near 0.5940, adding 0.08% on the day.