ADRIAN ORR our NEW RBNZ GOVERNOR

[Aaron]

Congratulations to the reserve bank.
https://www.stuff.co.nz/business/125...at-record-high

Maybe now raise interest rates or else people will start to notice that your job is to inflate asset prices.

[JBmurc]

The Reserve Bank would probably prefer to wait for more evidence of a sustained recovery before raising rates, ANZ said.......

Translation =the RBNZ is incredibly worried about the DEBT bubble in private debt it has help create with Govt policy and won't be raising rates till forced to by the FED

[stoploss]

The Reserve Bank would probably prefer to wait for more evidence of a sustained recovery before raising rates, ANZ said.......

Translation =the RBNZ is incredibly worried about the DEBT bubble in private debt it has help create with Govt policy and won't be raising rates till forced to by the FED

That’s right JB , last time we had a go at being the first country in the world to raise rates , the move was quickly reversed .
No point in being the first , they will only kill the primary sector as the currency goes North .

[GTM 3442]

Out of idle curiosity, when did the New Zealand economy last reach the Reserve Bank's inflation target ?

[Aaron]

Out of idle curiosity, when did the New Zealand economy last reach the Reserve Bank's inflation target ?

The target is 1%-3% CPI so has been in the range since 2017.
https://www.rbnz.govt.nz/statistics/...raph-inflation

The average for the last 20 years is 2.1%

My concern is the housing portion averages 7.3% for the last 20 years. Housing is 24.23% of the index and includes electricity, water, rates. Rent is 9.22% (c.f. alcohol and tobacco which is 6.96%) housing is 4.2% not including land, so basically asset prices do not form part of the CPI although asset values and interest rates have a direct inverse relationship. Using cheap chinese labour to manufacture a large chunk of our consumer goods while irresponsibly sending house prices beyond the reach of the next generation is good for the older generations who failed to save for retirement but are an absolute disaster for the younger generations.

[Aaron]

Although designed for school kids I think, this is a good summary.

As shown in the link Adrian does not consider asset prices as it is not part of his mandate. Even though he is largely responsible for the rise in house prices.

Trickle down economics assumes as long as the wealthy get wealthier, this will trickle down to the plebs.

https://www.rbnz.govt.nz/challenge/t...-and-inflation

[Panda-NZ-]

Inflation: achieved at under 2% (though with forecasting mis-steps)
Full employment: achieved.

Mission accomplished I suppose.

[Panda-NZ-]

Will technology eventually cause widespread deflation..?

These reserve banks may have to throw increasing amounts of money at people to keep inflation near 2%.

[stoploss]

Will technology eventually cause widespread deflation..?

These reserve banks may have to throw increasing amounts of money at people to keep inflation near 2%.

I very much doubt it with things like Rates ( 13-15%) Insurance ( 10%) Petrol ….. trades services , building materials …
all going up by way more than the “ official CPI “ I think we can ageee the basket needs a shake up to adequately reflect the cost of housing .
Not to mention the RBNZ look through a big one off gain in inflation , but it doesn’t mean it hasn’t and won’t continue to cost the consumer .

[stoploss]

Will technology eventually cause widespread deflation..?

These reserve banks may have to throw increasing amounts of money at people to keep inflation near 2%.

duplicate .....