Wednesday, 23rd June, 2021
It sounds bizarre. After all, we’re still in a global pandemic with the borders shut and our formerly top export earning sector on the ropes. But the NZ economy is increasingly at risk of overheating.
The supply side of the economy is clearly restrained by the closed border and disruptions to global supply chains and inventory levels. At the same time, the strength of demand continues to outstrip even the most optimistic of forecasters. The associated lift in cost and inflation pressures is increasingly proving too worrisome for central banks to keep waving away as entirely temporary.