The graph also shows what until late 1997 we referred to as ‘underlying inflation’, which was short-hand for the measure of inflation consistent with the intention of the Policy Targets Agreement (which permits us to disregard price shocks arising from certain changes in indirect taxation, significant changes in the terms of trade, changes in mortgage rates, and so on).
That measure of inflation remained consistently within the then 0 to 2 per cent target from 1991 until June 1995, despite economic growth in 1993-95 which, by New Zealand standards, was exceptionally high.