Stories about surging inflation, successive food price rises and more Kiwis in arrears topped bulletins and filled front pages last year. But recent news about slowing inflation, cheaper food and rising business confidence hasn’t had the same impact. How come?
Within the last month, surveys finding business confidence rising and food price inflation falling for the fourth consecutive month made few headlines.
But the bad news still does.
Last Thursday, TVNZ’s 1 News told viewers “New Zealanders are getting behind on payments”.
“More than 400,000 people fell behind on credit payments and the number of mortgage accounts past due exceeded 20,000,” it reported.
This was also based in the latest monthly report from credit agency Centrix, showing 4000 more Kiwis in arrears than a month earlier.
But last year more people were in arrears - and in 1 News’ own report this week Centrix explained the season was the reason for the latest modest monthly uptick.
“People tend to spend money and incur credit prior to Christmas. And it then comes back to bite them early in the new year,” he explained.
I wonder though if most of the wage growth is in the top 20 % or so, meaning it’s going way up for those on the top and not so much for the lowest paid, regular kiwi lol
In terms of recent years, in my experience people who jump jobs have got decent pay rises. People on benefits have got decent increases, minimum wage has increased decently.
My hunch is that it all ends up gobbled up by mortgage debt. People who have higher incomes can borrow more money. People who can borrow more can offer more for the limited supply of housing, causing house prices to sky rocket. These people then find their higher incomes are gobbled up by mortgage payments, and if they took out the mortgage before rates shot up but still have a decent mortgage (like most young home owners), then the rates rises would hurt.
While inflation takes into account mortgages, it’s only a minor portion by the time the calculations are done.
I don’t think so? In the 2000s I used to get yearly increases of about 5% and inflation was 2%.