There's a belief we're underestimating how high interest rates will go. 

ANZ has revised its forecast for the next six months, now predicting three hikes to the Official Cash Rate, bringing rates from 2.75% to 3.5%. 

Independent Economics Commentator Tony Alexander told Mike Hosking they'll likely climb even higher, sitting somewhere between 4% and 4.5%.  

He says the Reserve Bank predicts that the economic growth rate will accelerate, the unemployment rate will fall, and as a result, inflation will eventually fall from 4.1% to around 2%, which doesn't really add up. 

Alexander says everyone, including people like him, always underestimate how high interest rates will go during the tightening phase of a monetary policy cycle.  

LISTEN ABOVE 

There's a belief we're underestimating how high interest rates will go.&nbsp;
ANZ has revised its forecast for the next six months, now predicting three hikes to the Official Cash Rate, bringing rates from 2.75% to 3.5%.&nbsp;
Independent Economics Commentator Tony Alexander told Mike Hosking they'll likely climb even higher, sitting somewhere between 4% and 4.5%. &nbsp;
He says the Reserve Bank predicts that the economic growth rate will accelerate, the unemployment rate will fall, and as a result, inflation will eventually fall from 4.1% to around 2%, which doesn't really add up.&nbsp;
Alexander says everyone, including people like him, always underestimate how high interest rates will go during the tightening phase of a monetary policy cycle. &nbsp;
LISTEN ABOVE&nbsp;

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Open your mind to the world with New Zealand’s number one breakfast radio show. Without question, as New Zealand’s number one talk host, Mike Hosking sets the day’s agenda. The sharpest voice and mind in the business, Mike drives strong opinion, delivers the best talent, and always leaves you wanting more. The Mike Hosking Breakfast always cuts through and delivers the best daily on Newstalk ZB.

Open your mind to the world with New Zealand’s number one breakfast radio show.Without question, as New Zealand’s number one talk host, Mike Hosking sets the day’s agenda.The sharpest voice and mind in the business, Mike drives strong opinion,...

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Tony Alexander: Independent Economics Commentator on ANZ revising its OCR forecast, potential for interest rates to reach 4%

https://api.omny.fm/orgs/7784f840-c291-422a-924b-ad9000bbad71/clips/91a5cfe5-a008-4be7-acfa-b4cc015e7139/transcript