BNZ fears ETS will embed consumers’ inflation expectations
15 Apr 2008
The phased introduction of New Zealand’s emissions trading scheme (ETS) could persuade consumers that the resultant inflation of electricity, fuel and other prices will be a permanent fixture, the Bank of New Zealand (BNZ) has warned.
“The biggest worry is that consumers react to the impact of the ETS as if it’s an on-going issue for inflation, rather than regarding ETS-related price shocks as one-offs,” the Australian-owned bank said in an analysis.
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Story copyright © Carbon News 2008
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