1
00:00:00,160 --> 00:00:03,160
Speaker 1: How big will Adrian or go on rate cuts next month?

2
00:00:03,200 --> 00:00:06,000
Speaker 1: That is the question on everybody's lips. He's away on

3
00:00:06,040 --> 00:00:10,640
Speaker 1: business at the IMF currently, apparently. But after yesterday's lowest

4
00:00:10,680 --> 00:00:13,640
Speaker 1: annual inflation figure in three and a half years, back

5
00:00:13,680 --> 00:00:16,640
Speaker 1: in the safe zone at two point two percent, could

6
00:00:16,640 --> 00:00:20,079
Speaker 1: we see a seventy five basis point cut by Christmas? Gosh,

7
00:00:20,079 --> 00:00:22,720
Speaker 1: we're all excited, aren't we. Nick Tuffley is the asbchief economist.

8
00:00:22,760 --> 00:00:26,279
Speaker 1: He's with us this morning. Hey, Nick, morning, Hey, So

9
00:00:26,520 --> 00:00:28,280
Speaker 1: I mean this, first of all, this is great news,

10
00:00:28,400 --> 00:00:30,280
Speaker 1: isn't it that we're back in the safe zone? But

11
00:00:30,320 --> 00:00:33,000
Speaker 1: how safe are we? How pre curious is.

12
00:00:32,960 --> 00:00:37,520
Speaker 2: That we do think that inflation will be remaining very

13
00:00:37,520 --> 00:00:40,400
Speaker 2: close to two percent now over the next couple of years.

14
00:00:40,440 --> 00:00:43,240
Speaker 2: So if anything needs a chance that inflation could each

15
00:00:43,360 --> 00:00:46,599
Speaker 2: a bit below two percent at some point as we're

16
00:00:46,600 --> 00:00:49,400
Speaker 2: heading towards the end of twenty twenty five twenty twenty six,

17
00:00:49,640 --> 00:00:51,760
Speaker 2: we're really back in the zone now.

18
00:00:52,760 --> 00:00:55,560
Speaker 1: And it would take something quite dramatic to get us out,

19
00:00:55,600 --> 00:00:58,320
Speaker 1: because I mean, you look at the insurance, the rents,

20
00:00:58,720 --> 00:01:01,520
Speaker 1: the rates that will spected to keep going up, right,

21
00:01:01,840 --> 00:01:05,680
Speaker 1: But the international story is a different one. What about

22
00:01:05,680 --> 00:01:08,600
Speaker 1: if oil spiked because of the Middle East or something

23
00:01:08,680 --> 00:01:08,920
Speaker 1: like that.

24
00:01:10,280 --> 00:01:12,120
Speaker 2: Well, we still have that mixture where some of that

25
00:01:12,240 --> 00:01:14,920
Speaker 2: domestic inflation is still pretty high, and that will get

26
00:01:15,000 --> 00:01:16,840
Speaker 2: will eat a little bit going forward, and that will

27
00:01:16,880 --> 00:01:19,839
Speaker 2: help keep things down. We have had things like oil

28
00:01:19,880 --> 00:01:24,320
Speaker 2: prices falling back at times over the last quarter, which

29
00:01:24,360 --> 00:01:26,880
Speaker 2: helped keep inflation low at the moment. But yes, there's

30
00:01:26,880 --> 00:01:29,679
Speaker 2: always the watt if it will take a pretty significant

31
00:01:29,720 --> 00:01:32,119
Speaker 2: spike in the price of oil to push things up,

32
00:01:32,319 --> 00:01:35,600
Speaker 2: and the Reserve Bank won't necessarily rush to turn around

33
00:01:35,640 --> 00:01:37,880
Speaker 2: and start putting rates up or slow the pace down.

34
00:01:38,000 --> 00:01:41,640
Speaker 2: Because oil prices are something that can't control. They tend

35
00:01:41,640 --> 00:01:44,720
Speaker 2: to have a short term impact. But the Reserve Bank

36
00:01:44,720 --> 00:01:48,640
Speaker 2: would worry about so sizeable and lifting oil prices, whether

37
00:01:48,680 --> 00:01:52,120
Speaker 2: there are some lingering impacts created by just the impacts

38
00:01:52,120 --> 00:01:54,680
Speaker 2: that it has on transport and wider costs.

39
00:01:55,080 --> 00:01:57,240
Speaker 1: All right, I'll stop worrying about the oil thing now

40
00:01:57,280 --> 00:02:00,480
Speaker 1: and then Nick, thank you. What's up with the domestic

41
00:02:00,520 --> 00:02:03,520
Speaker 1: air travel? The price is down by eleven percent? I

42
00:02:03,560 --> 00:02:05,640
Speaker 1: was reading that going really eleven percent.

43
00:02:07,080 --> 00:02:10,320
Speaker 2: Well, we do find that air travels it's quite seasonal,

44
00:02:10,440 --> 00:02:14,320
Speaker 2: so it does go up and down from one quarter

45
00:02:14,360 --> 00:02:15,840
Speaker 2: to the next as we move in and out of

46
00:02:15,880 --> 00:02:19,080
Speaker 2: the sort of tourism season. We did see quite a

47
00:02:19,120 --> 00:02:23,600
Speaker 2: spike in sort of airfare prices in that sort of

48
00:02:24,120 --> 00:02:27,560
Speaker 2: immediate post COVID period, but we have now started to

49
00:02:27,600 --> 00:02:30,000
Speaker 2: see some settling down in that area, and you can

50
00:02:30,000 --> 00:02:33,239
Speaker 2: see that in accommodation costs as well, where the trend

51
00:02:33,240 --> 00:02:35,680
Speaker 2: has been that things have started to ease back after

52
00:02:35,720 --> 00:02:37,600
Speaker 2: that initial nudge that we saw.

53
00:02:38,760 --> 00:02:40,720
Speaker 1: Nick. Thanks very much for you update this morning. Really

54
00:02:40,720 --> 00:02:44,560
Speaker 1: appreciate it, Nick Tuley, chief economist at ASB Bank. We're

55
00:02:44,560 --> 00:02:46,280
Speaker 1: in the zone and it sounds like we're going to

56
00:02:46,280 --> 00:02:49,520
Speaker 1: stay there for the foreseeable, which is great news. For

57
00:02:49,639 --> 00:02:52,600
Speaker 1: more from earlier edition with Ryan Bridge, listen live to

58
00:02:52,720 --> 00:02:55,880
Speaker 1: news Talks there'd be from five am weekdays, or follow

59
00:02:55,960 --> 00:02:57,519
Speaker 1: the podcast on iHeartRadio