Market analysis: Rising prices for consumers in New Zealand may hinder further interest rate cuts.

Consumer prices in New Zealand rose in the second quarter, potentially blocking further interest rate cuts. Economists still expect the Reserve Bank of New Zealand to eventually resume easing monetary policy in light of a global economic slowdown caused by U.S. trade policies weakening growth prospects over the next year. Statistics New Zealand said on Monday that consumer prices in the second quarter rose by 0.5% compared to the first quarter, and by 2.7% compared to the same period last year. The annual inflation rate for the first quarter was 2.5%. While the annual inflation rate increase was slightly lower than economists' expectations, they still believe it may prompt caution from the central bank. The largest contributing factor to the annual inflation rate was local government charges, which rose by 12.2%. Gasoline prices fell by 8% year-on-year. Rent rose by 3.2% year-on-year, the smallest increase in four years. The Reserve Bank of New Zealand earlier this month kept the official overnight cash rate at 3.25% and warned financial markets to closely monitor inflation risks.