Has inflation peaked or is it merely pausing for breath to explode into hyper inflation Armageddon? Why 100 points must still be on Orr’s mind

H-e-r-e-s Adrian

To date those wanting Reserve Bank Governors to step back from OCR overreach have been crying out inflation has stalled, but as the latest figures show, gas it peaked or is inflation pausing for breath to explode into a hyper inflationary Armageddon?

From the US…

US inflation slows to 6.4 per cent, but price pressures re-emerge

The pace of consumer price increases eased again in January compared with a year earlier, the latest sign that the high inflation that has gripped Americans for nearly two years is slowly easing.

At the same time, the consumer price report from the government showed that inflationary pressures in the US economy remain stubborn and are likely to keep prices elevated well into this year. Rising costs will also keep pressure on the Federal Reserve to raise its benchmark interest rate further and to keep it there through year’s end.

Consumer prices climbed 6.4 per cent in January from a year earlier, down from 6.5 per cent in December. It was the seventh straight year-over-year slowdown and well below a recent peak of 9.1 per cent in June. Yet it remains far above the Federal Reserve’s 2 per cent annual inflation target.

And on a monthly basis, consumer prices increased 0.5 per cent from December to January, much higher than the 0.1 per cent rise from November to December. More expensive gas, food and clothing drove up last month’s figure.

…as TDB pointed out, the biggest component of US inflation was petrol prices which Biden had been able to successfully repress by tapping the US Strategic Oil Reserves.

TDB Recommends NewzEngine.com

That’s a one trick pony he can’t play again.

In NZ we saw 10.3% food inflation prices, down from 11.3%, but underlying that drop was the caution that we had pulled all the levers to drop prices and it didn’t take into account the food inflation impact of the Auckland Flooding or Cyclone Gabrielle and with another Cyclone possible before April, that 10.3% could easily spike over the next 3 months.

Liam Dann: The rate of food price rises has dropped – a glimmer of calm in the inflation storm?

The food price data that dropped today was still ugly.

But at of 10.3 per cent, the annual rate of increase was lower than expected and down on the 11.3 per cent rise for the year to December.

…we see NZ House prices falling but stubbornly high core inflation costs now baked into the economy.

What does Orr do?

Does he pause in his 75point hikes or does he push even harder and push for 100 points.

If the market doesn’t believe Orr has the political capital to push up

This all happens as the Australian Reserve Bank pushed their OCR up 25 points with a clear warning they intend to keep the pressure up as high inflation numbers there surprised the market.

Does Orr risk allowing inflation to spike again or does he deal to it now?


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  1. The latest B.O.A. survey had the consensus view that the Fed would pivot at 5.25%. But at the current rate of (consumer price) inflation, that is still a negative real rate.

    When they do pivot, in order to prevent all the bad debts from imploding, it’s going to be off to the races for inflation again.

    They need several years of high inflation to inflate away the vast amount of unpayable debt, which will worsen the collapse in real wages.

    Nobody is demanding some kind of debt write off, or a policy of simply allowing big corporate bankruptcies. This suggests that the general public has no idea what is coming.

  2. Eeee Orr is going to have to lock and load that spare $100b Bazooka!

    The clean up after these storms will cost at least that alone, which will add to mega-inflation!

    Labour are fuck’d if they do, or, if they dont!

    If they spin it right and everyone gets a piece of the motherload of Bazooka funding. That could seal the deal for them to be re-elected.

    Bribe 5 million kiwi with $100b!

  3. Poor old bastard. Orr has a terrible conundrum to de conundrumise.
    The reality is simple to state yet almost impossible to comprehend. Never the less, here goes:
    Since about 140 years ago farmers have been bled out by a cadre of post-farm-gate ( no pun intended.) con artists hiding in plain sight within the politics they created to best suit themselves and their mates sequestered within the absurdist ‘ producer boards’ who are really nothing more than street level criminals feeding stolen money to their mafia Overlords in Big Business and politics. Aye Boys?
    Seriously, put on a fancy suit, talk posh, flounce about as if butter wouldn’t melt if a pound (500gms) of it were rammed up your arse hole and everybody will fall for any narrative you can pop out your lying mouth hole. George Stantos https://en.wikipedia.org/wiki/George_Santos is currently a good example of [that] a better example of a pathological liar as was bernie madoff. https://en.wikipedia.org/wiki/Bernie_Madoff
    Orr’s problem is simple. He’s inherited a gargantuan lie. A lie which is our entire economy and the corrupt politics that comes with it. Poor old Orr. What the fuck’s he going to do?
    On the one hand we have meaningless inflation where there doesn’t need to be any and on the other, our farmers are in full swing earning our primary industry economy while the cities spend it as now nine multi billionaires hoard it while foreign owned banks steal it out from under our noses.
    The problem for Orr is that he’s not yet figured out how to tell us the extremely uncomfortable truth. And that is that we’ve all been, and are being, fully fucked without the kissing. You know those down trodden? You know those hungry kids and poor people living in poverty? You know those hospitals that run on the smell of an oily rag? Well, [all that’s] directly the fault of the unemployed. Ba Ha! Got ya. All the trouble that once were beautiful, trusting AO/NZ’ers are knee deep in is as a direct result of crooks doing crooked shit without most of us even realising it. The perfect crime, one might argue.
    That’s why a very public royal commission of inquiry please. Seriously, please? And sooner rather than too later.
    In the real-time, mean time. Adrian? Become a legend of contemporary politics who’s name will be written up their with the great names representing honesty, decency, honor and bravery or be a cringing rat amongst the other rats in the woodpile.
    But be quick! Because we’re not that far away from becoming someone else’s country without a hope in Hell of salvation.
    You like sleepless nights? Then watch this.

  4. as our (in NZ) inflation is largely down to personal/household spending on geegaws by the haves whilst the poor are gouged on goods and services(low NZ wages do not contribute to anything except poverty) it takes political action not central bank doodling to effect it.


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