Ryan Bridge: Nicola Willis is right not to splash the cash

A 1pm presser and Covid‑style alert levels. This fuel price spike is bringing back bad memories from those dark days of lockdown. But a few facts help put things in perspective. There are a lot of scenarios and best guesses floating around, but the reality is we’re not yet short on fuel. That’s at least weeks away, we’re told. The economy is in recovery, and even the worst‑case scenarios still have us growing at a little under 3% — about half a percent off pre‑war predictions. The other big difference is the response. Interest rates, even if inflation hits the high 3s, aren’t expected to shoot up dramatically or immediately, because demand falls as people put less petrol in the Honda. If you live rurally, or don’t have a Grey Lynn tractor — a.k.a. a Tesla — the price of fuel will sting. But it won’t cause the sort of catastrophic, long‑term damage that lockdowns and Covid supply disruptions did.Nicola Willis, who fronted yesterday’s 1pm media event, made it pretty clear that excise cuts and other expensive relief (think cost‑of‑living payments) aren’t off the table — but they’re not top of the list either. This government is a different beast from the one that came before it. They’ve learned the lesson — one we’re currently paying for — about splashing the cash to stay popular. They’ve resisted demands for stimulus despite two bitter years of recession. Spending big when inflation is about to spike would completely undermine their political credibility. Which means that when something bad happens — which it is, or is about to — we’ll feel the effects in real time. And that’s no bad thing.See omnystudio.com/listener for privacy information.