The Statistics New Zealand consumer price index - the official measure of inflation - is due tomorrow.
In an unusual coincidence, economists in both Westpac and ASB labelled their inflation forecasts "Up, up and away", a sign they, and other forecasters, believe our higher inflation is on the way up.
Westpac chief economist Brendan O'Donovan is expecting inflation to reach 4%, up from 3.4% in March.
ASB chief economist Nick Tuffley and ANZ-National Bank chief economist Cameron Bagrie are both expecting inflation to be 3.8%.
Mr O'Donovan said major movers in the quarter were expected to be petrol prices, food prices and housing-related costs.
"Inflation in New Zealand is high and rising. Firms' pricing intentions and widespread cost increases . . . point to even higher inflation ahead. Annual inflation lifting to 4% is uncomfortable for the Reserve Bank, given its potential to pollute inflation expectations."
The situation was expected to intensify in September, when Westpac expected inflation to reach 5.5%, he said.
Non-tradeable inflation is seen as the key to the Reserve Bank cutting its official cash rate on July 24.
Non-tradeable inflation largely reflects items not open to international influences.
That includes the housing sector (rent, not materials) government and local government charges and the service industry.
Tradeable inflation is represented in things like food, petrol and international air fares.
Mr Tuffley said from Auckland rents had been picking up as would-be buyers stuck to renting.
An oversupply of homes for sale was starting to encourage some vendors to rent homes out in the interim.
Construction and maintenance costs were likely to show only modest easing, if at all.
Communications would also contribute to non-tradeable inflation, through higher mail and phone line charges.
The Reserve Bank had signalled its easing in monetary policy would be on the expectation that weaker economic growth would pull non-tradeable inflation down, he said.
However, a slowing down would not necessarily be evident this early into the cycle.
Any signs that non-tradeable inflation was picking up would be some cause for alarm, directly challenging the conditions the Reserve Bank set out.
