RBNZ Preview: OCR expected to remain unchanged as central bank focuses on inflation

The Federal Reserve Bank of New York’s Center for Microeconomic Data today released the June 2024 Survey of Consumer Expectations, which shows that inflation expectations declined at the short- and longer-term horizons, but increased slightly at the medium-term horizon. Similarly, one-year-ahead expectations about home prices and one-year-ahead expectations about specific goods prices all declined. The main findings from the June 2024 survey are: Inflation Median one- and five-year-ahead inflation expectations both declined by 0.2 percentage point in June to 3.0% and 2.8%, respectively. In contrast, the median three-year ahead inflation expectations increased 0.1 percentage point to 2.9%. The survey’s measure of disagreement across respondents (the difference between the 75th and 25th percentile of inflation expectations) remained unchanged at the one-year ahead horizon, declined at the three-year-ahead horizon, and rose at the five-year ahead horizon. Median inflation uncertainty—or the uncertainty expressed regarding future inflation outcomes—declined at the one- and three-year-ahead horizons, but rose at the five-y post: *US 1-YR INFLATION EXPECTATIONS FELL TO 3% IN JUNE FROM 3.2% *US 3-YR INFLATION EXPECTATIONS ROSE TO 2.9% IN JUNE AFTER 2.8% *US 5-YR INFLATION EXPECTATIONS FELL TO 2.8% IN JUNE AFTER 3%