Kelvin Davidson

I think in the end, 3.1% is above target.

That's what people see.

That's what people understand to some extent.

They're still sort of concerned about that cost of living, not only the level of prices, but also the growth rate.

So yeah, I just think, what does it amount to?

Probably that you have to, don't panic, but also don't ignore the possibility that inflation stays a bit higher for longer.

you know those official cash rate increases that people were talking about sort of early 2027 potentially they get brought forward now there's a lot of water to go under the bridge you know there's capacity okay the economy's turning around but it's been a been a pretty prolonged recession so even if some indicators are picking up in growth terms they're still starting from a low level in terms of the the activity

So yeah, I wouldn't necessarily panic, but you do have to acknowledge the risk that OCR increases do get brought forward into this year rather than next year, which will have implications for mortgage rates and all sorts of things.

So yeah, hopefully that's a reasonable summary.

In the end, I'm a wee bit cautious, as I say, of taking out stuff that goes up just to make it a bit more convenient because it's still stuff going up.

People are still buying those things.

They're still having to pay for it.

So, yeah, I tend to side on the risks of an OCR increase coming forward.

um yeah i suppose cpi it's i may have already said it but you know don't ignore it i mean it's above the target for sure but there were some temporary factors that that mean it you know it should and then air quotes sort of come back down next quarter so it's one of those ones and don't ignore it but also let's not panic

um and even the people have now been saying it you know an ocr increase coming sooner than previously expected we're still talking about the end of the year rather than sort of early 2027 so you know it's it's not a sort of panic stations but also yeah let's well i mean there'll be a lot of interest on the q1 inflation number and sort of three months time as well as we get monthly indicators too so that they'll be they'll be worth watching as well so um

Yep.

Don't ignore it, but don't panic, I suppose, is the way to sum it up.

But yeah, I mean, these things are all related.

And while the inflation number might not be that great, it stems from other good news, which is the economy is turning around.

You can't have one without the other, I suppose.