By James Glynn
SYDNEY--Inflation expectations continue to tumble, greatly easing pressure on the Reserve Bank of New Zealand to further raise interest rates.
Expectations for inflation one year ahead dropped to 2.73% in the first quarter from 3.22% in the previous survey, data from the Reserve Bank of New Zealand showed Monday.
Similarly, the closely watched two-years ahead measure declined to 2.33% from 2.50% the previous quarter.
The dramatic fall in expectations comes as the farm-rich economy remains in an extended recession, amid signs that the contraction might continue for a while yet.
Earlier Monday, data showed that the economy continues to languish.
New Zealand's services sector is suffering through its weakest period since the start of 2022, suggesting few signs of an emerging recovery.
The BNZ - BusinessNZ Performance of Services Index for April was 47.1, down 0.1 points from March, the lowest level of activity for the sector since January 2022.
Write to James Glynn at james.glynn@wsj.com
(END) Dow Jones Newswires
05-12-24 2335ET
