Welcome to our final edition newsletter for 2022. An opportunity to say thank you to all of the wonderful clients and friends of Advice Knight and to wish you all a very merry Christmas and a Happy New Year.
It’s certainly been a tumultuous ride throughout the duration of 2022 juggling COVID changes, new industry regulations, rapidly moving lender policies before becoming particularly wild in the latter stages as our Reserve Bank Governor, Adrian Orr, became scrambling to stamp out rampant inflation through a series of sharp interest rate hikes. The Official Cash Rate has incredibly climbed from a record low of 0.25% only 18m ago right through to the current 4.25% and is tipped to reach a potential high of 5.5% come April.
While your editor hasn’t made it a secret that he isn’t Mr Orr’s biggest fan and strongly feels that things became too loose too quickly (i.e. interest rates were slashed rapidly and money printed in haste before any data existed) through to now where it feels as though rates have risen too quickly before having a chance to kick in, it is acknowledged that it is important for inflation to be brought into check. And for all his fumbling foibles he is only one man; one cog in a machine that almost feels pre-programmed to march right of the cliff, whether it is he or some other lever-puller standing at the control panel. Like a clown shot out of a circus cannon, New Zealand’s economy trajectory feels firmly fixed for recession in 2023...
But at this stage, as far as we can tell the pumps still pump when we fill the car, the coffee still tastes the same (albeit more expensive), bakers still bake and economists still pretend to know what they’re talking about it! So enjoy the ride dear readers.