Cameron Bagrie: independent economist on New Zealand's CPI reaching 3.1 percent for the first quarter of 2026

Inflation's already looking vulnerable, with the reality of worse economic blows still to come. 

Figures out today showed annual CPI unexpectedly held at 3.1 in this year's first three months, confounding expectations it would fall as low as 2.8. 

Economist Cameron Bagrie says the rate reflects what was happening to prices, just as the cost of fuel began to climb, when the Iran war closed the Strait of Hormuz. 

He says we'll get an inflationary hit in the June quarter, and a better starting position would have been preferable. 

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Episode Transcript

Speaker 1 (00:00):
Together do for cl the inflation number has come in
slightly higher than expected with the March quarter and add
zero point nine percent instead of the expected zero point
eight percent, which holds the annual inflation at three point
one percent. Independent economist Cameron Baggery is with us Hi
can Hi, can we blame this largely on the power prices?

Speaker 2 (00:18):
AH, power food, A bit of a diesel petrol kicker
came through in the month of March. But I guess
if you step back and look at the bigger picture.
The bigger picture is that we're going to take an
inflation you have in Q two the June quarter, you
kind of hope that the starting possession would not have
been three point one percent, i e. Outside of you

(00:39):
one to three percent inflation target, people were saying headline
rate might be down at two point seven to two
point eight. We didn't get a four. We got a
flat line number. Your three point one percent in December
quarter last year has become three point one percent March
two thousand and twenty six. So we're going to see
that go buoying north and then quarter where you get

(01:00):
the real impact of this will move shock.

Speaker 1 (01:03):
Now, what's the explanation for why the pharmaceuticals have spiked.

Speaker 2 (01:08):
I'm not sure in regard to that detail, but what
we're seeing across the general health group. You look at
your medical insurance bills, those things are going up at
double digit rates. But you've got a whole lot of
areas here, whether it be medical insurance, whether it be
your rates, whether it be electricity bills, you are there
turbo charging. It's called double digit inflation, and that makes

(01:29):
it pretty hard to achieve two percent inflation.

Speaker 1 (01:31):
Yeah, listen, Cam, it's good to talk to you. Thank you, mate,
appreciate a. Cameron Baggery, founder of Baggery Economics. For more
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