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  • rmacculloch

BUDGET 2022: Robertson "agreed" there would be no inflation crisis - now Kiwis are paying the price

Look at the document below which I found in the government's files - its says that inflation in NZ is to be held at 1 to 3 percent over the medium term and is signed off and "agreed by" the Finance Minister and Reserve Bank Governor:


Yet on Budget Day yesterday, Treasury released its inflation forecasts which are HIGHER than 3% for 2022, HIGHER than 3% for 2023 and HIGHER THAN 3% for 2024. It was also over 3% this past year, 2001. Yes this inflation is not temporary, it is not "transitory". New Zealand will NOT be achieving its agreed inflation target, not even remotely, over the "medium term". My question is: since when can a Finance Minister and a Reserve Bank Governor put their signatures to an "agreed" course of action, then willfully ignore it? In monetary economics, we call it a loss of credibility.


Sources:

https://www.treasury.govt.nz/sites/default/files/2022-05/befu22.pdf