Adam Clark

Yeah, and that's a really good point.

And it's a very interesting kind of conundrum for the Reserve Bank to be in because they have a single mandate.

just bought into legislation, you know, under the current government, they are responsible entirely for inflation.

Keep inflation under control and nothing else matters.

Correct, correct.

And that's where, like, we've seen a little bit of a change in the wholesale rates recently where

you know different terms will adjust based on market expectation right and so sometimes you know the market will go if we go back to say midway through last year the market all of a sudden decided there are some you know some quote-unquote green shoots in the economy and we're expecting some some you know some stronger future performance so we started to seeing wholesale rates going up in the kind of the three the four the five relatively sharply based on the fact that the economy is going to be stronger in the future

Whereas we look at now and we're starting to see sharper increases in short-term wholesale rates.

And what that says to me, and this kind of touches on your point perfectly, that short-term spike relates to the current increase in fuel cost.

But actually what I think will come through is that cost of living pressures are so strong at the moment, people are not going to be able to spend.

And so expectation, you know, you read the tea leaves, so to speak, is that inflation will hit us hard in the short term based on the cost of fuel.

And then actually the flow on effect of that is that the interest rates don't necessarily need to stay high.

Because cost of living pressures are so high that the minute you put interest rates up further, people are going to be pretty tight pretty quickly.

And so we should have some quick impact or some quick kind of relief from some of those increases.

Yeah, I think, I mean, you can't compare the two.

I think that's the thing we have to be super clear on.

The previous hiking cycle came off the back end of the loosest monetary policy this country has ever seen.

And often, not always, but often these things work in proportion to each other, right?

So the easing was such an extent that we had to go sky high in order to balance things back to neutral.

Whereas we're not coming off a super low base.