According to the Reserve Bank of New Zealand’s business survey released today, domestic business operators project inflation will cool to 3.0% one year ahead, dropping from 3.7% in the June quarter. This easing outlook extends to anticipated wage growth of +2.8% and a projected jobless rate of 5.2% over the next twelve months, down from 5.5% in the prior quarter, providing key economic indicators for the central bank’s upcoming policy decisions.
Fuel Imports Drive New Zealand Trade Deficit Out to -$1.2 Bln Worse Off
Strong export gains across multiple sectors were heavily overshadowed by rising energy costs in July, pushing the national trade balance to -$1.949 billion. According to trade data, July exports climbed nearly +14% year-on-year to an increase of +$881 mln, bolstered by significant jumps in meat (+$251 mln), dairy (+117 million), fruit (+$91 mln) and aluminium (+$59 mln). However, total imports surged +28% or +$1.187 billion compared to the previous year, driven largely by a +$932 million spike in fuel payments. The resulting deficit is the largest recorded in two years, far exceeding the 2025 equivalent of -$762 million.
Open Banking Surges as Payments NZ Prepares to Close API Centre
Regulated open banking transactions continue to accelerate across New Zealand, even as structural shifts alter the payments landscape. According to the Ministry of Business, Employment & Innovation (MBIE), 408,000 transactions worth $130 million occurred via open banking services in July, climbing from 294,000 transactions valued at $92 million in May. MBIE reports that 14 organisations have earned the Consumer Data Right Accreditation Trust Mark. Simultaneously, Payments NZ announced that its API Centre will cease operating at the end of September, with open banking standards management transferring directly to MBIE. Payments NZ noted that July data-sharing consents reached 221,000 customers, with data requests topping 19 million for the first time.
Did you know? According to Reserve Bank figures, approximately $2 trillion in retail payments flow between New Zealand banks annually.
International Rate Pressures and Global Market Movements
In Japan, consumer price inflation rose to 1.9% in July, reaching its highest level since December 2025 with food prices up +3.5%, according to official data. This upward trajectory increases the likelihood that the Bank of Japan may adjust its 1% policy rate during its September 18 review. Meanwhile, US Treasury 10-year yields rose +7 bps to 4.70% following market reaction to the US Treasury buy-back plan, while New Zealand’s 10-year government bond rate ticked up +3 bps to 4.75%.
Frequently Asked Questions
What is the current business inflation outlook in New Zealand?
According to the Reserve Bank’s business survey, firms expect inflation to reach 3.0% one year ahead, down from 3.7% in the June quarter.
How much did July fuel imports impact New Zealand’s trade balance?
Fuel imports increased by +$932 million compared to the previous year, pushing the July trade deficit out to -$1.949 billion, the largest in two years.
What is happening to the Payments NZ API Centre?
Payments NZ announced its API Centre will cease operating at the end of September, with the responsibility for managing open banking standards shifting to MBIE.
How are open banking transaction volumes trending?
According to MBIE data, regulated open banking transactions grew from 294,000 valued at $92 million in May to 408,000 transactions worth $130 million in July.
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