Can businesses pass on costs, as the Reserve Bank claims? | Herald NOW Business

Can businesses pass on costs, as the Reserve Bank claims? | Herald NOW Business <!--mynz:youtube-chapters--> {"v":1,"chapters":[{"timeSeconds":0,"label":"Market Update and Reserve Bank Claims","summary":"The local equity market has experienced a sharp move in the 3-year swap rate. This has raised questions about mortgage costs, business funding, and the housing market."},{"timeSeconds":15,"label":"Reserve Bank Commentary and Market Reality","summary":"Matthew Goodson discusses the Reserve Bank's recent speech, noting that the market interpreted it as a signal of aggressive action against inflation. He highlights the 30 basis point rise in swap rates across the curve."},{"timeSeconds":48,"label":"RBNZ Signals vs. Market Reality","summary":"The Reserve Bank's signals are contrasted with market reality, as the RBNZ itself hiked rates by 50 basis points. Oil prices have also seen a rebound."},{"timeSeconds":113,"label":"Mixed Signals on the Ground","summary":"On the ground, the situation is mixed. Some businesses are struggling to cut costs, while others have the ability to pass on price increases. Some businesses are still seeing price increases, while others are not."},{"timeSeconds":144,"label":"RBNZ Hike Affecting Markets","summary":"The RBNZ's rate hike is starting to bite markets, with surveys indicating that businesses are not expecting to pass on price increases. However, some businesses are still seeing price increases."},{"timeSeconds":211,"label":"Impact on Mortgages and Funding Costs","summary":"The Reserve Bank's focus is on businesses, but the reality is that most underlying measures are in the mid-2s. The key drivers are administrative and local authority rates. These are not impacted by RBNZ policy."},{"timeSeconds":253,"label":"Inflation and Market Outlook","summary":"The Reserve Bank's inflation target is 2%, but current inflation remains significantly above that. The market is still pricing in further rate hikes, though some believe the RBNZ is already tightening too much."}]} <!--/mynz:youtube-chapters-->