Latest / Best of Business / Kelly Eckhold: Westpac chief economist on what the US-Iran peace agreement could mean for fuel prices

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Kelly Eckhold: Westpac chief economist on what the US-Iran peace agreement could mean for fuel prices · Best of Business

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  Speaker 2: So what does this mean for what we are paying
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  Speaker 2: at the pump? Cali Echold is West Pax chief economist
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  Speaker 2: and with us, Hey, Cally, Hey, Now, are you standing
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  Speaker 2: by your prediction of ninety one hitting two dollars? Eighty
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  Speaker 2: two dollars?
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  Speaker 3: Ninety seems to be about right based off where we
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  Speaker 3: see the futures in the exchange rate today. When does
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  Speaker 3: it hit there thanks a couple of weeks typically for
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  Speaker 3: these things to flow through, although I could already see
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  Speaker 3: a few gas stations around here having ninety one price
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  Speaker 3: just blow three bucks at the moment, so it's not
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  Speaker 3: that far away.
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  Speaker 2: And then do you think it holds below that?
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  Speaker 3: Well, that depends on what the futures in the exchange
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  Speaker 3: rate does. And your previous speaker highlighted that there's plenty
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  Speaker 3: of water to go under the bridge here before we
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  Speaker 3: get a durable kind of like resolution to this issue.
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  Speaker 2: What are you looking for in terms of like signs
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  Speaker 2: that this is is it? The ship starting to move?
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  Speaker 3: The ships need to move, that's right, and they need
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  Speaker 3: to move both in and out of the Gulf. Yeah,
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  Speaker 3: because that will then be giving you the idea that
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  Speaker 3: the supply chain has been fixed, because it's the supply
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  Speaker 3: chain that's failed, and we know that there's pretty low
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  Speaker 3: infantories out there around the world at the moment, so
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  Speaker 3: we need that supply chain to be working at full
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  Speaker 3: tilt for a while so that all of those things
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  Speaker 3: can get replenished. And at that stage, I think you'll
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  Speaker 3: have full confidence that normal service has been resumed. Kelly.
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  Speaker 2: If this is the end of it, and if you're
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  Speaker 2: right it's two dollars eighty two dollars ninety, does that
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  Speaker 2: mean that we've dodged the worst of the inflation? Can
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  Speaker 2: we say that that it's just a blip in inflation?
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  Speaker 2: Nothing is better in here?
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  Speaker 3: Well, that's still a higher price a two eighty two
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  Speaker 3: ninety than it was pre crisis, and it's the case
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  Speaker 3: that a whole lot of other follow on products and
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  Speaker 3: the petrochemical chain have gone up in price and won't
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  Speaker 3: necessarily before in any time soon. So that's CPI is
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  Speaker 3: still going to be well over three percent I think
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  Speaker 3: for the next sort of three court. But it is
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  Speaker 3: true to say that will probably be all redoing our
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  Speaker 3: thumbs on where the peakers and I'm sure the Reserve
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  Speaker 3: Bank will be as well.
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  Speaker 2: Yeah, Kelly, thanks as always, good to talk to you,
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  Speaker 2: Kelly A cold westpax Chief Economist.
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