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  • rmacculloch

The US Treasury Secretary has apologized for getting inflation "wrong". Will our Finance Minister?

US Treasury Secretary Janet Yellen told CNN last week that she was "wrong" when she said last year that inflation was only temporary and wasn't likely to be a problem.

Meanwhile, back in July of last year our Finance Minister commanded media headlines on Radio NZ, "Minister brushes off inflation concerns as growing pains". He even inferred inflation was a good thing .. "Increasing inflation is an effect of unexpectedly strong growth in the economy, Finance Minister Grant Robertson says". His dismissal of a cost-of-living crisis went on and on .. "Robertson brushed off concerns, saying the RBNZ expected rises [in inflation] in June & September to be temporary & system was designed to handle it".

Yet in April of last year, this blog reported that, "The NZ Institute of Economic Research says its' surveys "suggest a pick-up in inflation pressures over the coming year". And the latest Retail Radar survey of Retail NZ members showed two thirds of retail businesses expect to see prices rise over the next quarter ... The Monetary Policy Committee plays down these "near-term price increases" as a "temporary" state of affairs. My prediction is that the cost of living is on the way up in NZ and interest rates will be going up sooner rather than later".

In July of last year we ran the headline "How can a Blog (and Sharon Zollner, the ANZ Bank Chief Economist) make better inflation forecasts than 250 RBNZ staffers?" Since in May of 2021 the ANZ's Business Outlook survey showed inflationary pressures were soaring. "Reported costs are through the roof", said Zollner.

Yet the RBNZ repeatedly referred to inflation as being "temporary" over the past year & the Finance Minister repeatedly repeated that claim. But you wont get an apology out of them. You wont get them admitting they were "wrong", even though the US Treasury Secretary has admitted her mistake. Grant & Adrian were too busy printing money in July of 2021.



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