Will NZ have deflation?

The Herald reports:

The New Zealand economy may be in its first six-month period of deflation in more than a decade, in the face of weak crude oil prices and global over-capacity, pushing the prospects of interest rate hikes out into 2016, according to Bank of New Zealand. …

BNZ head of research Stephen Toplis says for New Zealand, deflation during the current cycle isn’t the ugly phenomena being grappled with in, say, the euro-zone, where consumer prices fell 0.2 per cent in 2014 and where demand has been dwindling.

By contrast, New Zealand’s economy is operating at or above capacity, the housing market is still steaming, and kiwis are showing no inclination to rein in their spending.

“Normally when you talk about deflation you are petrified,” Toplis said. “The wheels are falling off, there’s a downward price spiral. But there’s zero evidence of that in New Zealand at the moment. The single biggest thing is our ability to freely access world goods at low prices. For New Zealanders that’s a good thing unless you’re a local retailer.”

“There is absolutely no evidence whatsoever of retrenchment in activity due to the pressure on the general consumer price level,” he said.

I don’t think it would be a bad thing to have a growing economy, growing wages and falling prices.