Food prices rose 12.5 per cent in the year to April 30, that’s the highest rate since September 1987.
Yesterday’s food price statistics were a stark reminder that Kiwis are still feeling the pain from the rising cost of living.
Despite the fact that higher interest rates are starting to bite and the economy is starting to slow, we cannot yet relax in the fight to beat inflation.
Anyone who remembers the year to September 1987 will recall the country was in a pre-sharemarket crash, inflationary investment bubble. Mortgage rates were up at eye-watering heights, close to 20 per cent.
Most economists expect the Reserve Bank will need to deliver at least one more Official Cash Rate hike on May 24, taking it to 5.5 per cent.
That will see two-year fixed rates above 7 per cent.
Clearly, we are not seeing a repeat of those 1980s excesses.
With the size of the average mortgage so much larger now (nominally and relative to income) the pain will be real.
There’s no getting around the need to rebalance the economy and pay the price for the Covid stimulus-fueled boom - albeit a boom that successfully protected us from a far more serious economic slump than the one we now face.
But there is hope that we are nearing the end of this painful part of the economic cycle.
On Thursday, markets around the world cheered the news that US consumer price inflation had cooled again - the 10th consecutive month of deceleration.
The US Consumer Price Index climbed 4.9 per cent in April from a year earlier, less than the 5 per cent that Bloomberg’s survey of economists had expected.
Stripping out volatile prices like food and oil, the core measure (that central banks tend to focus on) was an improved 5.5 per cent.
Globally, commodity prices have plunged in the past year. We are now seeing the price effects of the pandemic play through in something like the transitory manner that most economists expected.
But the flow-on through to domestic economies - as local businesses pass on costs and wages rise - is taking longer to unwind.
There was a risk that domestic inflation would spiral and become embedded. And that required central bank action.
In New Zealand, the flooding and weather events have compounded food price inflation, but there will always arise short-term issues to deal with.
Despite that the April food price index rise was not actually a shock to economists - it was in line with expectations.
It won’t have shaken the view that topline inflation has peaked.
As that food price spike plays through the numbers, we’ll be left with wages and employment as the last piece of the puzzle to fall into place.
Once we can be sure that we see the rate of inflation is on the decline, there will be scope for the self-inflicted pain of monetary tightening to be eased.
In other words, the Reserve Bank will have regained some control of the economy - until the next big global shock at least.
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Poll: Should all neighbours have to contribute to improvements?
An Auckland court has ruled a woman doesn’t have to contribute towards the cost of fixing a driveway she shares with 10 neighbours.
When thinking about fences, driveways or tree felling, for example, do you think all neighbours should have to pay if the improvements directly benefit them?
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82.6% Yes
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14.7% No
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2.7% Other - I'll share below
Meditation Introductory
A four-part progressive course introducing the essentials of meditation and a wide canvas of differing methods to get you underway. The accent is on guided practice, with several progressive meditations each evening.
Guest teacher Jogyata spent many years under the guidance of the late Indian spiritual master Sri Chinmoy, and brings a wealth of practical experience, personal stories and insights to share. His w/shops are known for their encouragement, inspiration and simplicity.
When: Consecutive Tues Nov 26; Dec 3, 10, 17;
7pm – 8:30pm
Where: 89 Dominion Rd, Mt Eden. Cnr of the Dominion Rd/Tawari Street.
Registration is encouraged to ensure seating space – simply text your name/contact details to Jogyata: 0221887432.
RE: Hosting a FREE inspirational talk by Harita Davies
Kia Ora
I would like to introduce you to Harita Davies, our national record holder in 3100-Mile race.
Harita is the only New Zealand woman to ever attempt and complete the world's longest certified running race, the 3100-Mile race (94km for 52 days and 28 pairs of running shoes!) The Self-Transcendence 3,100-Mile Race, described as “The Mount Everest of Ultramarathons” by the New York Times, requires competitors to maintain an average of 60 miles a day, amounting to over two marathons every day for 52 days!
Each year, contestants are drawn to the 3100-mile ultra for often inner reasons. Testing their physical and mental limits, with a curiosity about human potential itself. The race promises personal growth and self-discovery. Participants come from around the world to shatter their perceived limitations and discover a deeper sense of self. Only six women have ever completed the 3100-mile distance since its inception in 1997.
Please listen to Harita's many interviews with RNZ - www.rnz.co.nz...
Watch a trailer about the award-winning documentary covering the 3100 Mile Race -
www.youtube.com...
Accompanying her will be Preetidutta Thorpe, ultra marathon runner and a former Olympic-level contender in sailing who has just completed the Everest Marathon last year.
For Harita, meditation is the ultimate game changer in her running. This holistic approach cultivates peak performance and nurtures a deeper sense of well-being, She believes that caring for our own sense of peace is one of the most powerful contributions we can make to creating a better and more peaceful world.
Kindly get in touch if you would like to have Harita talk to your school/class about her experience and share a few simple practical meditation techniques to cope with stress, improve focus and cultivate resilience. The duration and depth of the subject matter can be tailored to suit.
Harita, now living in the US, and will be back in Auckland on Wednesday 12 February.
I look forward to the opportunity to discuss any possibilities for inspiring your school community to take the first step.
Warmest regards,
Durba Lee Preetidutta Thorpe
Mobile: 0220 653 719 Mobile: 0220 814 727
Sri Chinmoy Centre
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