Westpac Chief economist Kelly Eckhold tells Herald NOW that NZ's long-awaited economic recovery is delayed, but not cancelled as Iran conflict continues.

Westpac Chief economist Kelly Eckhold tells Herald NOW that NZ's long-awaited economic recovery is delayed, but not cancelled as Iran conflict continues.

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New numbers reveal an updated outlook on New Zealand's economic recovery

Finance Minister Nicola Willis has emphasised there’s a range of scenarios for inflation amidst the global oil crisis – not just the worst-case scenario of 3.7% outlined yesterday. 

“We don't know what's going to happen with factors that are outside of our control,” she told Mike Hosking. 

“We don't know how long the Strait of Hormuz will stay closed. We don't know whether Asian refineries will be able to access alternative supplies of oil in sufficient quantities, and we don't know whether importers will be able to access alternative supplies of refined products. So we're preparing for all of those scenarios.” 

The Government remained "hopeful" there was enough cover, refineries could keep producing enough fuel and importers could bring in the quantities New Zealand needed. 

Treasury would be the first to acknowledge their forecasts were “guessing games”, but "we have to plan for what could be around the corner so that if bad things happen, we're ready". 

Hosking pointed out other countries were taking action to relieve mounting costs, including heating oil relief in the UK overnight. 

But Willis said the UK and Europe’s energy and electricity prices were much more affected by events in the Middle East than New Zealand, which relies largely on hydro and renewables. 

Our Government is closely monitoring the international response to the ongoing closure of the Strait of Hormuz. 

Donald Trump is calling on several allies to send warships and other support to secure the strait. 

Japan and Australia say they currently have no plans to send naval ships and UK Prime Minister Keir Starmer say neither will Britain be drawn into a wider war. 

But Willis told Mike Hosking there will be much to play out in the days ahead. 

She says they do want to see the Strait of Hormuz reopened, and it will be up to all countries to decide whether and what role they plan. 

"We haven’t been asked to participate in any particular efforts in the Strait.” 

LISTEN ABOVE 

Finance Minister Nicola Willis has emphasised there&rsquo;s a range of scenarios for inflation amidst the global oil crisis &ndash; not just the worst-case scenario of 3.7% outlined yesterday.&nbsp;
&ldquo;We don't know what's going to happen with factors that are outside of our control,&rdquo; she told Mike Hosking.&nbsp;
&ldquo;We don't know how long the Strait of Hormuz will stay closed. We don't know whether Asian refineries will be able to access alternative supplies of oil in sufficient quantities, and we don't know whether importers will be able to access alternative supplies of refined products. So we're preparing for all of those scenarios.&rdquo;&nbsp;
The Government remained "hopeful" there was enough cover, refineries could keep producing enough fuel and importers could bring in the quantities New Zealand needed.&nbsp;
Treasury would be the first to acknowledge their forecasts were &ldquo;guessing games&rdquo;, but "we have to plan for what could be around the corner so that if bad things happen, we're ready".&nbsp;
Hosking pointed out other countries were taking action to relieve mounting costs, including heating oil relief in the UK overnight.&nbsp;
But Willis said the UK and Europe&rsquo;s energy and electricity prices were much more affected by events in the Middle East than New Zealand, which relies largely on hydro and renewables.&nbsp;
Our Government is closely monitoring the international response to the ongoing closure of the Strait of Hormuz.&nbsp;
Donald Trump is calling on several allies to send warships and other support to secure the strait.&nbsp;
Japan and Australia say they currently have no plans to send naval ships and UK Prime Minister Keir Starmer say neither will Britain be drawn into a wider war.&nbsp;
But Willis told Mike Hosking there will be much to play out in the days ahead.&nbsp;
She says they do want to see the Strait of Hormuz reopened, and it will be up to all countries to decide whether and what role they plan.&nbsp;
"We haven&rsquo;t been asked to participate in any particular efforts in the Strait.&rdquo;&nbsp;
LISTEN ABOVE&nbsp;

Nicola Willis: Finance Minister on the ongoing global oil crisis, action in the Strait of Hormuz

There's hopes the war in Iran doesn't reverse gains in our retail sector by making shipping more expensive. 

Stats NZ data shows back-to-back increases in electronic card spending for January and February. 

Retail NZ chief executive Carolyn Young says it's not happened in a long time. 

She says it would be a shame if the conflict dampens the upward trend.

"Let's hope it's a short, sharp thing and we can get back to business as usual."

LISTEN ABOVE

There's hopes the war in Iran doesn't reverse gains in our retail sector by making shipping more expensive.&nbsp;
Stats NZ data shows back-to-back increases in electronic card spending for January and February.&nbsp;
Retail NZ chief executive Carolyn Young says it's not happened in a long time.&nbsp;
She says it would be a shame if the conflict dampens the upward trend.
"Let's hope it's a short, sharp thing and we can get back to business as usual."
LISTEN ABOVE

Carolyn Young: Retail NZ CEO on retail spending trending upward before Iran conflict

Treasury has released numbers on the potential fallout for the New Zealand economy from the Iran war.

It estimates that under a worst‑case scenario — a conflict lasting until the end of the year with elevated oil prices — inflation would rise from 3.1 percent to 3.7 percent.

Finance Minister Nicola Willis says that number is too high - but is lower than Australia's current inflation - which is sitting at 3.8 percent. 

ASB Chief Economist Nick Tuffley told Ryan Bridge forecasting in this climate is difficult. 

He says other spikes in oil prices have led to higher inflation - but this will all depend on how long the conflict lasts. 

LISTEN ABOVE

Treasury has released numbers on the potential fallout for the New Zealand economy from the Iran war.
It estimates that under a worst‑case scenario &mdash; a conflict lasting until the end of the year with elevated oil prices &mdash; inflation would rise from 3.1 percent to 3.7 percent.
Finance Minister Nicola Willis says that number is too high - but is lower than Australia's current inflation - which is sitting at 3.8 percent.&nbsp;
ASB Chief Economist Nick Tuffley told Ryan Bridge forecasting in this climate is difficult.&nbsp;
He says other spikes in oil prices have led to higher inflation - but this will all depend on how long the conflict lasts.&nbsp;
LISTEN ABOVE

New numbers reveal an updated outlook on New Zealand's economic recovery

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