ANZ's Zollner on RBNZ Policy, N.Z. Economy

The video discusses the Reserve Bank's view on inflation, driven by rising oil prices and a dampened New Zealand dollar. It explores the challenges central banks face in balancing growth and inflation, especially with supply shocks like oil price increases. The impact of the Omicron variant on the economy, particularly in hospitality and retail, is examined. The labor market is tight, with low unemployment and high wage demands, contributing to inflationary pressures. Finally, the potential effects of border reopening on economic growth are considered, highlighting challenges in tourism and labor supply.

What are the two main factors contributing to inflationary pressures in New Zealand as discussed in the video?

• Falling oil prices and a strong New Zealand dollar

• Falling oil prices and a weak New Zealand dollar

• Rising oil prices and a weak New Zealand dollar

• Rising oil prices and a strong New Zealand dollar

Why might the Reserve Bank of New Zealand avoid a 50 basis point interest rate hike during the Omicron outbreak?

• It could be seen as too aggressive given the current economic stress

• A 50 basis point hike would be deflationary

• The Omicron outbreak is expected to boost economic growth

• There is a consensus among analysts for a 50 basis point hike

What is the current state of the labor market in New Zealand?

• High unemployment and high labor force participation

• Low unemployment and low labor force participation

• High unemployment and low labor force participation

• Low unemployment and high labor force participation

How might the reopening of borders affect New Zealand's labor supply?

• It will decrease labor supply due to emigration

• It will immediately solve labor supply issues

• It will have no impact on labor supply

• It may not solve labor supply issues due to global competition for workers

What is a potential consequence of the tight labor market on wages in New Zealand?

• Wage inflation is expected to rise

• Wage inflation is expected to remain stable

• Wage inflation is expected to decrease

• Wage inflation is expected to have no impact