Originally Posted by
LaserEyeKiwi
There are plenty of people that have been saying for months that much of the non-tradable local inflation is being driven by essential services (council rates, insurance, utility bills) unmoved by interest rate increases, or worse are actually going up because of interest rate increases.
But if RBNZ cant impact those factors to reduce inflation, they are going to have to go even harder on the rest of the economy that they can impact.
I myself think there is another option (let inflation ride at 3-4% for a year or two), but unfortunately is not an option for them while they are directed to keep inflation below 3%.
Wouldn’t be surprised if current government is considering changing that target band - because at the current RBNZ track the economic pain might continue into the 2026 election cycle.