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Business and finance leaders expect inflation to be firmly under control, and the official cash rate to likely fall sharply, over the next year.
The Reserve Bank's (RBNZ) quarterly survey of expectations shows two-year-ahead inflation expectations at 2.12 percent - up 9 basis points from the last quarter, but within the RBNZ's 1 to 3 percent target.
The survey had responses from 40 business leaders and professional forecasters.
The official cash rate is expected to fall 50 basis points by the end of December to 4.25 percent, and decrease to 3.33 percent in a year's time.
The RBNZ said expectations for the unemployment rate remained steady, up just one basis point from last quarter's 5.11 percent to 5.22 percent in a year's time.
Expectations for wage growth declined slightly to an annual 2.81 percent growth in a year's time, but the average two-year-ahead expectation for annual wage inflation rose 30 basis points to 3.16 percent.
The survey also showed belief the economy would rebound, with economic growth expected to be 2.17 percent in two years, up slightly from previous expectations.
On the housing front, expectations are building for the market to pick up over the coming year, with house price inflation expectations up 71 basis points to just over 3 percent.
However, two-year house price inflation expectations fell nearly a quarter of a percentage point to 4.17 percent.
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