24 Nov 2010

Lower inflation expected by business

6:22 am on 24 November 2010

The latest survey from the Reserve Bank shows the inflation expectations of companies fell in the fourth quarter.

The bank's survey shows business managers expect inflation to average 3.4% over the coming year, down from 3.9% in the previous quarter.

Two-year inflation expectations were slightly higher at 2.6%.

The survey also shows economic growth is forecast at 2.5% in the coming year, up from 2.3% in the previous survey.

But expectation of growth over the coming two years slipped from 2.8% to 2.7%.