They are performing the 50-point chorus like a well-drilled choir, and it will be the fifth consecutive time this song will have been heard.
Ordinary borrowers, meanwhile, will be getting the blues, as the official cash rate (OCR) goes up from 3.00% to 3.50%, and home mortgages follow with a refrain.
There are all the usual reasons for this choice of music.
“Sticky” inflation gets a lot of the blame, according to ANZ economists.
They think the CPI might have peaked at 7.3% for the June quarter, but getting it back down again will be very hard work.
“Back in the August Monetary Policy Statement, the RBNZ made it clear that it intended to raise the OCR by 50 basis points at the October and November meetings,” the ANZ team wrote.
“There have been no significant data surprises that would provide a compelling reason for the RBNZ to diverge from that path.”
Westpac senior economist Satish Ranchhod also forecasts a 50-point rise on Wednesday, and two more to follow.
That will take the OCR to a peak of 4.50%, up from his earlier forecast of 4.00%.
As with his ANZ brethren, Ranchhod blamed more persistent inflation pressures than he had anticipated.
“In particular, we now expect the New Zealand dollar to be lower for longer, adding to the pace of inflation in the year ahead.
“In an already overheated economy....the risks of second–round inflation pressures are greater. We expect the RBNZ to repeat that the OCR will continue to rise 'at pace',” Ranchhod wrote.
Kiwibank's chief economist Jarrod Kerr is also expecting a 50 point rise, followed by another in November.
“Aggregate demand remains too high relative to the Kiwi economy’s ability to meet it,” he said.
“Supply-side factors such as chronic staff shortages, and delays in deliveries of materials are keeping productive capacity constrained, and a continued tightening of monetary conditions remains justified, for now.”
So the economists are all singing the same song, and parts of it are a gloomy dirge.
According to Kerr, the Reserve Bank needs to see “pain in households before they are confident they’ll beat inflation back down to 2%.”
Ranchhod had the same view: “The household sector is bearing most of the brunt of the adjustment, as we expected.”
