RBNZ’s Breman flags near-term inflation rise, warns on second-round risks

Neutral-to-hawkish. Reinforces that near-term inflation alone won’t trigger tightening, but any shift in inflation expectations or second-round effects would increase the likelihood of rate hikes, supporting NZD on persistent inflation signals. Breman signalled higher near-term inflation but stressed a conditional response, with policy hinging on cost pass-through and second-round effects.SummaryBreman reiterates near-term inflation lift driven by energy shock… Breman signalled higher near-term inflation but stressed a conditional response, with policy hinging on cost pass-through and second-round effects. Breman signalled higher near-term inflation but stressed a conditional response, with policy hinging on cost pass-through and second-round effects. Summary Breman reiterates near-term inflation lift driven by energy shock Growth expected to soften alongside rising costs Focus on whether firms pass through costs or absorb margins Monitoring for second-round effects and inflation expectations shift Signals readiness to act if medium-term inflation risks build Repeats stance of not reacting too quickly… For traders, releases like this can quickly shift rate expectations, currency direction, index futures and broad risk sentiment. Watch the next move in the dollar, front-end yields and index futures to see whether the market prices this release as a true surprise or only a passing headline.