TD Securities monthly inflation has ripped off a wild number for December at 0.7% month on month, pushing the yearly rate to 2.7%. However, much of the jump was due to one-off influences, including an unseasonably large 5.8 per cent spike in prices for fruit and vegetables and higher tobacco taxes. The falling dollar is also apparent with petrol rising 5 per cent.
There will be increasing tradable inflation coming through the pipeline this year but it should be offset by soft labour markets.
