Bagrie Economics lead economist Cameron Bagrie says the lift in annual inflation to 4.1% was no shock, with the market and Reserve Bank both expecting about 4%.

He says underneath, price pressure is more contained.

“If you strip out fuel, your core inflation, which is less food and energy, is still running around 2.5% across a whole lot of measures,” he says.

He says the country is running a two-speed economy.

“It is a good old-fashioned export-led recovery. We’re earning a buck before we spend a buck.”

Farmers should brace for the farm input cost figures due in weeks.

“Will they be right up there? The answer is yes.”

CountryWide CONNECT with Andy Thompson & Sarah Perriam-Lampp is our daily rural show livestreamed from 11am-1pm. Visit country-wide.co.nz on how to watch/listen or download the CountryWide CONNECT mobile app, available on Apple iOS and Android.