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Speaker 1: Now call me superficial, but to watch the Reserve Bank

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Speaker 1: heavyweights lined up as I did yesterday afternoon post their

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Speaker 1: cash rate decision, you are not seeing dynamism there. Believe me,

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Speaker 1: these people outwardly do not fill you with any sense

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Speaker 1: of excitement. The Reserve Bank, I think, is in a spot,

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Speaker 1: and as a result, so are we as a country.

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Speaker 1: The couple of semi interesting things happened yesterday, and in fact,

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Speaker 1: one very interesting thing. They voted five to one to cut.

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Speaker 1: They don't vote often. They also offered alternative scenarios. They

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Speaker 1: haven't done that for five years. Alternative scenarios are not

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Speaker 1: a good sign in my mind. Have enough of them.

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Speaker 1: You're literally making stuff up. I mean, anyone can drum

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Speaker 1: up alternative scenarios. What I want to hear from and

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Speaker 1: more from the experts, is what's actually going on. The

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Speaker 1: important stuff is that they've got no bias now on

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Speaker 1: further cuts. A lot of people thought, including me, we

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Speaker 1: would get a cut yesterday, followed by one more, possibly

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Speaker 1: two more, the so called neutral rate, that cash rate

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Speaker 1: would settle at two seven five or two point five.

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Speaker 1: That now seems to be off the table. Why they

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Speaker 1: argue inflation, which is what drives them. That's their mandate

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Speaker 1: is in the band. Trouble with that is it's only

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Speaker 1: just in the band. It's heading more towards the top

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Speaker 1: of the band. And here is the really big part.

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Speaker 1: Growth or large dollops of growth are not driving this inflation.

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Speaker 1: We're barely growing, if growing at all. And yet inflation

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Speaker 1: is still a thing that's not good for an economy,

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Speaker 1: and it's certainly not good for government. See the government,

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Speaker 1: namely Willis and Luxon. They leap and have leapt on

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Speaker 1: each announcement talking about the money coming back into the

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Speaker 1: economy as the interest rates drop. If the bank isn't

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Speaker 1: cutting rates aren't dropping, and we aren't spending or feeling

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Speaker 1: remotely bullish, the RB doesn't care that much because they're

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Speaker 1: fixated on inflation, whether it's driven by factors beyond our control,

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Speaker 1: things like insurance or shipping or sitting councils and rates

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Speaker 1: or what we really want growth. Yes, we've had growth

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Speaker 1: in Q one, quite good growth. The live GDP track

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Speaker 1: of those got Q two up a bit, but not much,

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Speaker 1: and it has annual numbers still in the negative inflation

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Speaker 1: trending up. What we need, broadly speaking, in the economy's help.

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Speaker 1: We're in a quagmire. We need to extricate ourselves out of.

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Speaker 1: The RB doesn't look like interested. For more from The

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Speaker 1: Mic Asking Breakfast, listen live to News Talks at B

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Speaker 1: from six am weekdays, or follow the podcast on iHeartRadio