Here's our summary of key economic events overnight that affect New Zealand with news it is becoming clearer that Iran holds the cards in the economic aspects of the Middle East conflict. Pointedly, so far no-one - not China, Japan, nor NATO - has responded positively to Trump's call for naval help.
Meanwhile in the US, even though crude prices retreated somewhat today, retail petrol prices there are up +0.5% today from yesterday, up +7% in a week, up +27% in a month.
Away from Trump's war, American industrial production rose in February, but by far less than in January and that was enough to reduce the January year-on-year gain of +2.3% to a February equivalent of just +1.4%. This is a sharpish slowing that wasn't the expected +2.1% gain. It was their smallest month-on-month rise in six months.
And the New York Fed's Empire State factory survey suggests it may have got worse in March. That survey did not grow unexpectedly. It came in with a 'steady' -0.2% dip when a +3.2 rise was expected. New order growth disappointed.
Meanwhile the NAHB homebuilder sentiment survey held steady at a good level as expected. But they are worried about the growing discounting required to maintain sales.
In Canada, they reported a lower February CPI rate of 1.8% with their core inflation rate at 2.3%, both less than in January.
Canada also reported housing starts which rose from January, maintaining a good level and about at the average level over the last five years. But they were +13.7% higher than year-ago levels, and actually their second best February level ever.
The Bank of Canada meets next on Thursday (NZT) and no change to its 2.25% policy rate is anticipated.
Across the Pacific, China’s new home prices across 70 cities dropped -3.2% year-on-year in February, following a -3.1% decline in the previous month. Shanghai was the outlier with higher prices. But for house resales, nothing is rising, even in Shanghai which was down -6.5% for the year. Some are down almost -10% (Wuhan).
But China's February retail surprised to the upside, rising +2.8% and much better than January's +0.9%.
China's industrial production came in much better than expected as well, up +6.3% and well above the +5.1% expected and the +5.2% in the prior period.
Beijing is pushing through 'pay reform' for middle managers at its state owned banks - and it is turning out to be far more brutal than those managers expected. Many are seeing their pay cut steeply, especially bonuses. And there is a retroactive aspect as well applying to their 2024 bonuses.
Separately, India said its exports held steady in February, although its imports fell, allowing it to report a smaller trade deficit.
Later today, the Australian central bank will review its cash rate target settings with a backdrop of high and rising inflation before the Middle East war started. The RBA is the first central bank of at least nine this week to review monetary policy in these changed circumstances. Markets have priced in a two-thirds chance of a +25 bps rate rise. Most analysts have come to the view it is the likely result too. The RBA is prioritising its inflation fighting mandate, they expect.
The UST 10yr yield is now just on 4.23%, down -5 bps from yesterday at this time. The key 2-10 yield curve is holding at +54 bps. Their 1-5 curve is flatter at +19 bps (+4 bps) and the 3 mth-10yr curve is now at +53 bps (-5 bps). The China 10 year bond rate is down -1 bp at just over 1.83%. The Japanese 10 year bond yield is up +5 bps at 2.29%. The Australian 10 year bond yield starts today at 4.96%, up +1 bp from yesterday. And the NZ Government 10 year bond rate starts today up a sharp +8 bps at 4.77%.
Wall Street has started its week with the S&P500 up +1.0% so far. Overnight, European markets were also up, but only between London's +0.6% and Paris's +0.3%. Yesterday, Tokyo closed down -0.1%. Hong Kong ended its Monday session up +1.4%, but Shanghai dipped -0.3%. Singapore ended up +0.5%. The ASX200 closed down -0.4%. And the NZX50 closed on Monday down -0.2%.
The price of gold will start today down another -US$34 from yesterday at US$4984/oz. Silver is holding at US$80.50/oz.
American oil prices are down -US$3.50, at just under US$95.50/bbl, while the international Brent price is down -US$1 just over US$102/bbl. The Straits of Hormuz remain no-go areas for most with the situation still extremely unstable.
The Kiwi dollar has risen today, up +70 bps against the USD from yesterday, now just over 58.5 USc. Against the Aussie we are up +20 bps at 82.9 AUc. We are up +10 bps against the yen. Against the euro we are up +30 bps at 50.9 euro cents. That all means our TWI-5 starts today up +60 bps at just under 62.2.
The bitcoin price starts today at US$73,762 and up +3.4% from this time yesterday. Volatility over the past 24 hours has been moderate at just under +/- 2.3%.
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58 Comments
Good interview of Bernard Hickey yesterday.
https://www.rnz.co.nz/national/programmes/afternoons/audio/2019027109/p…
One financial scribe who 'gets it'.
Re Trump's call for help - listen to him! "They're down to their last shots, so there's very little danger". If they're down to their last shots, why does he need help? Tellingly, Europe - essentially Nato - is saying this was an unprovoked and illegal attack by Israel and its big dumb support-act. We are looking at a new world order, probably ex the US. Meaning ex the petrodollar. Meaning a lot of forward bets, made on assumptions of continuance, are going to look suboptimal. Yet Trump has one thing right; the First World needs ME oil.
Listen to Hickey carefully, all you forward-betting types.
:)
The US is still going to be a big player in whatever comes next. Resource rich, big moat around them, and still the best military on the block. They're just not going to have the same global projection, as they burn all their soft and hard power.
What few (if any) will be able to do is accurately forecast the coming years. Economics as a discipline will be turned on its head, because for 80 years it's worked on rather predictable and linear underpinnings.
Agreed.
Roughly speaking, Hickey is pointing to a change, though. The change is to thinking of 'money in the bank' as actually possessing the stuff your future self/community/nation will want. Before it stops being available. Whether the current accounting system is capable of adapting to that mindset - which will include a demand for longer-lived, easier-maintained items - is yet to be seen.
A lot of people in the current First World will have spent their main lives amassing proxy, probably a drive based on lizard-brain status-seeking (originating ecologically, in mate-attracting). They may have to re-skill and re-appraise somewhat.
Predictably unpredictable?
I feel like I’ve been hearing the same things over and over since I started reading this site 20 years ago. The world’s turned to shit, there’s going to be a war, fiats going to collapse, there’s too much debt, we are running out of oil, ponzi going to collapse, etc. Maybe this time it will be true, but I’ll just get on with my life and assume it’s not.
With all due respect, I regard that as illogical.
Out of interest, do you figure here?
Programmed to Ignore? | Do the Math
It seems that a small minority think in exponential/repercussive terms.
What do you suppose I should do? It sounds like you are all setup (no doubt via energy use / economic growth / mortgages / etc in the past), but I still need to pay my mortgage, support my kids, support all those on NZ super and needing healthcare, save for my own retirement, and save to help my kids out with a stupidly priced house and university. Its easy for you to say money doesn't mean anything etc when you don't need to do any of those things.
I could say "we are out of energy so I'll just give up and go on the dole as there is no other option", but I'd rather have some proof first. For example I would expect the price of fuel to be much higher if we were indeed about to run out or were anywhere near it.
Maybe this time it will be true, but I’ll just get on with my life and assume it’s not.
It's best just to do life one day at a time. Today, the wheels of commerce are still turning pretty much the same as yesterday.
Longer term though, people should be contemplating their liabilities and exposure.
Its hard to know what to do long term:
- If the liabilities get written off (maybe via inflation) you are better off having liabilities
- If you have money where do you safely put it?
- Do you regret putting it somewhere safe when you could have got a much safer return elsewhere (which would have been the case throughout most of history).
- Will I get NZ super or will it be means tested
- Should I make myself energy resilient or will it be cheaper to achieve later
All hard questions to answer. I suspect I'm on a reasonable path.
Re your last point; cheaper isn't the variable. Available, is the criteria.
Having energy is permanent money in the bank (Hickey absolutely nailed it).
Having proxy is - having proxy. How much of it you have is irrelevant if - make that when - supply-chains dry up.
Most of NZ's electricity is generated by some water falling down a hill. So unless gravity is on its way out, it doesn't sound like we will completely run out of electricity. There could be dry years etc, we will get through them, I'll make sure our BBQ gas bottles are filled up.
Its not economically sensible to insure yourself against every possible event, you have to make a line call every so often. Its not impossible to survive a few months without electricity, and that seems highly unlikely.
With respect, you seem to be arguing for inertia.
Remember that grid electricity is 40% of NZ energy use. And that it is moot whether the grid is maintainable, ex FF. And that anything which can morph fast to electricity from FF, will.
Food-production is ahead of energy (although it's sort-of the same thing; solar capture). It's certainly cheaper, if that is your criteria.
I guess we all make our choices.
Remember the 1960s & 70s. The world didn't end then either & we got on with our lives making the best decisions we could with the hand we were dealt. It's helpful to consider the trees as well as the forest: in the long run we're all dead.
Either?
linguistics...
There was a LOT more native timber to harvest for housing back then, a lot more coal and wood used for heat which is no longer there, and a lot more easily tapped oil on land which was cheap to get to comparitive to today, and as well as these additional resources, there were less people to spread them around.
Memento mori
They're always going to try. Trump is already reaping the rewards of his attitude towards NATO with Europe's refusal to support him on his call for help with the Hormuz strait. The world that America used to lead is already turning its back on America because of Trump. He will continue to flail about, clumsily, but his and the country's influence is already significantly diminished. A big question will be how far will their military go to do as he directs, or will they start to refuse their orders?
How would anyone commit to a military partnership with this clown of a state? It's leader can't maintain a coherent thought for more than 30 seconds. America has basically showered it's friends and allies with brown stuff for over a year. It's not just Trump. All those drones lined up behind him are also Trump.
In a press conference I just saw, Trump was saying his request for support in his war on Iran was a test of other nations, rather than him feeling lonely, politicaly exposed and out of solutions for his stupid decisions. Ironically, when Ukraine offered help with drone warfare, Trump said he doesn't want help from Zelensky. Meanwhile his "mate" Putin is providing help for Iran.
How far will his military go? All the way. Just like the judiciary and all other gov services, the top layers of command are also Trump.
As an anonymus comment succinctly put it, "America isn't like this because Trump is president, Trump is president because America is like this."
"America isn't like this because Trump is president, Trump is president because America is like this." Hard to disagree with that, but it takes a deeper understanding of American political history to understand the comment. To be fair though I do feel that most presidents kept trying to maintain standards or raise the game. The problem is their political system is too captured by big money. It's not uncommon, and even an issue here in NZ, but to be able to achieve anything, political compromises are required and too many of them give the truly corrupt license. They are their own worst enemy though.
Trump will now try to turn his back on Europe, but all that will achieve id drive the realignment of Europe away from the US faster and further. That raises a question about a European war against Russia. How would that look and who will reach for their nukes first? America pulling it's nukes out of NATO will not leave them without nukes. France has it's own and has already held talks with Germany about forward basing them.
"That raises a question about a European war against Russia. How would that look and who will reach for their nukes first?"
Yes, interesting question. Europe has been going it alone with it's support of Ukraine for over a year now. It hasn't resulted in Ukrainian capitulation. I doubt Europe has any intention to commit troops to the actual fight, conversely, I doubt Russia has the resources to take Europe on. Russia will continue it's hybrid warfare in Europe, helping political movements that suit it's expansionist agenda.
Nuclear? Nope. Europe wouldn't reach first. There's nothing to gain by doing so, except extinction. It's not a war Europe wanted and they've dragged heels on responding to Russian escalation at every opportunity.
Russia? Nothing to gain for them either. They have played the "I'm unhinged, don't mess with me card" too often over 4 years. Russian propaganda TV insisting they are battling the Satanic West while splattering the cameras with spittle. Under what scenario could Russia use Nukes? If Europe actually invaded Russian territory of course and they had no other resources to defend themselves. That's not going to happen. Although Russia has "annexed" a swath of Ukraine, they don't seem altogether convinced it is Russia and will remain so, despite the rhetoric. They are certainly prepared to take a hammering in "Novorossiya" without nuclear response.
That nuclear weapons have now become so topical is more than alarming. Over to the east Nth Korea supposedly has about 50 bombs, some of reasonable sophistication. Nasty bit of speculation this but if Iran is so desperate for nuclear arms and Nth Korea is so desperate for money and fuel, what’s to stop a deal, not even clandestine if they so choose. That is after all the Axis as the West labels it, Russia, China, Iran, Nth Korea standing together.
FG. Except that China keeps NK on the tightest of leashes, as it did with his father. Kim will only do whatever Xi allows him to. And it is definitely not in Chinas interests to provide a volatile Iran on whom it depends for a good chunk of its oil, with doomsday tech.
Which is then a bit strange that China didn’t stop the NK development in the first place. China has more than enough weapons to deter an attack on themselves & NK. But let’s just hope you are right.
Palmtree, you asked...
"How far will his military go? All the way?"
That is the exact question that profoundly concerns Scott Ritter - he is very explicit about this, as he views this as an existential question... quoted/paraphrased at 54:30...
https://www.youtube.com/watch?v=SGX_sE7TkWw
"If this war goes south and we (the US) exhaust our missile interceptors on land and at sea - remember that the only thing that keeps the carrier battle group viable is the fact that it is surrounded by Aegis-class ships that can shoot down missiles.
We have a finite number of these, and when we run out, the carrier battle group is literally defenceless, and we have to withdraw. Our aeroplanes operate from bases - when we run out of missiles, we have got nothing. The Iranians aren't going to run out of missiles.
So if you can't find an off-ramp there can be a situation where a significant number of American troops are' in harm's way, and we can't defend them. At that point in time, the US, doctrinally, can most definitely use nuclear weapons.
I would also point out that Pete Hegseth, even though I don't like the man - he said this once, he has probably forgotten about it, but every time we had exercises (simulations) where we used nuclear weapons and thought we could have a limited nuclear war, it always bounced back and forth and became a global exchange.
This is a very dangerous situation for the US to use nuclear weapons. The last remaining arms control treaty between the US and Russia expired on February 4th - there is no more arms control. In fact, both sides, especially the US, are increasing their deployed nuclear weapons - we are going in the wrong direction, and there is no framework of limitation.
We have nuclear anarchy right now, and you throw in a situation where we start using nuclear weapons and its not going to be what Newt Gingrich said - it will begin a process that doesn't end until everyone in the world is dead from a thermo-nuclear exchange - and so nuclear weapons aren't the answer.
And I hope that there are people telling this to Donald Trump, although I know that the Chairman of the Joint Chiefs of Staff told him that we can't keep Hormuz open, and Tulsi Gabbard that there will be no regime change, and he still went to war on the premise that we would change the regime and keep the strait open.
Somebody needs to remind this president that we cannot use nuclear weapons - that is not the answer - it will only create life-ending consequences.
We need to get out of this war, and the Russians and Chinese know that, and they are working to help create an off-ramp that will give the president some sort of face-saving mechanism."
...end quote...
This is what I was trying to convey yesterday, before I was drowned out in a sea of Russiaphobia.
Putin is one of the very few adults in the room. He understands only too well that Trump is the type of unhinged and highly compromised lunatic who could easily set off a chain of events that could be the end of humanity.
I am fully on board with Ritter - I believe that Russian and Chinese diplomacy are probably our last chance left to save a rapidly escalating situation - one that escalates by the day and threatens, not just the global economy, but ultimately our survival as a species.
Cheers
Col
This is what I was trying to convey yesterday, before I was drowned out in a sea of Russiaphobia.
You avoided answering questions directly and instead trotted out pro-Russian commentators. I don't think anyone here's really that against Russia as a country, it's more the lack of objectivity you bring.
If you concentrated on actually having a discussion instead of doing big text dumps you'd get a better reception.
It's one of those great ironies that Russophiles crow about the "West" wanting Russias resources, when Russia was happily selling them BEFORE it invaded Ukraine. Now Trump has a taste of military adventurism and created a global energy crisis, Putin the shirtless white knight, is riding in offering to ease pain with Russian resources. Something doesn't smell right?
"Ritter argues that the West needs to stop treating Russia as a "resource to be exploited and exhausted"".
Palmtree. I disregard any commentary from well known Putin fanboy and convicted pedophile Scott Ritter.
Amen.
Once again, your attitude is off the charts, Pa1nter.
This behaviour became glaringly evident to me when I first began following this site.
You said..."I don't think anyone here's really that against Russia as a country."
Anyone with half a brain would know that this is complete nonsense - you yourself are clearly against any "pro-Russian commentator" being quoted, as if you are somehow the sole adjudicator on this.
You seem to fancy yourself as an oracle on all subjects, even when you regularly show a breathtaking ignorance on some topics.
You also seem to play the role of a formal gatekeeper (perhaps you are?) within any discussion that challenges the status quo narratives that pervade this site.
As usual, you are backed up by your cosy little club of supporters, some of whom were incredibly personally insulting to me from day one.
This will be the last time I will ever respond to you. I fully expect a sarcastic riddle as a response, as you always insist on getting the last word in.
I also note that you hide behind a nom de plume.
I have always commented under my proper name.
Your insinuation that I have changed the name that I post under is yet another one of your infantile projections.
It is so very easy to hurl personal insults when you don't have the guts to post under your real name. If you get off on trying to fit me up with that kind of behaviour, then this is a very sad commentary on your character.
The difference between you and me, is I know what Russia is.
The revolutionary Bolshevik government, of less than 20 years, signed a deal wth Nazi Germany whereby Russia seized half of Poland without firing a shot. Russia then happily proceeded to lucratively feed the Nazi war machine as they scourged through the continent. All of that was less than 100 years ago during which time invasion and occupation has been common activity. Finland pre war and then post Hungary, Czechoslovakia, Afghanistan, Georgia, Crimea, Ukraine. Imperialism is not at all hard to find in Russian recent history is it.
While we share many concerns about America and Trump, I don't share your confidence that Russia will prevail as a voice of reason. They are just further down the same path that America is currently heading - a major power exhausting its military against an intractable foe in an unnecessary war.
Ayup.
They're both bad. But also, doing what superpowers do. Well, fading ones anyway.
Russia being "further down the path" infers at some point they were "up the path". Russians have no historic memory of a time of freedom and prosperity. The US OTOH are happily giving up their freedom and democracy for an impoverished Putinesque authoritarian mafia militarised post truth oligarchy.
No doubt the cosy little club here and the Russiaphobes/Sinophobes will have UK Navy Commodore Steve Jermy down as a Russian asset as well.
At 34:00...
https://www.youtube.com/watch?v=1MN7nECum_w&t=832s
...quoted...
"Of course the key player now, or a potential key player, in bringing this war to a close is Russia, and so it doesn't surprise me at all that Trump has acxtual;ly phoned Putin, and it sounds like they had a fairly sober discussion, but Russioa could be a key player in bringing this war to a close, because I very much doubt that the Iranians are going to listen to the tpop the Americans - and why would they, I mean each time they have tried to negotisate with the Americans they have been attacked.
I think the most plausible people to actually mediate some ort of conclusion to this war would be Russia. Now Russia is probably the great beneficiary of the war, and indded the Russian economy is the great beneficiary of the war, and not that it was doing badly, and so what that also means is that if the Russian economy is strong, then the chance of the Europeans sanctioning Russia to the table are even less than they already were.
But it is also in China's interests that the war is brought to a close, and so I think the two ideal mediators would be China and Russia..."
Mines! Crude, cheap old fashioned and effective. Don’t even need to lay a field. Just the notion of a couple of hundred drifting around enough to keep any oil tanker skipper in harbour.. WW1 technology holding the modern world to ransom.
FG. The old days of mine tactics consisting of towing a paravane wire cutter behind a wooden boat and destroying by gunfire are long gone. Electronic location of mines and deployment of remote semi autonomous anti mine torpedoes from either ships or aircraft now allow mine clearance from considerable distances. Trumpy's problem is the narrowness of Hormus, with any anti mine responses often within reach of land based missiles, even manpads if working close enough to shore. Floating mines not an option for Iran, they need to allow Chines and other friendlies to navigate the strait.
Interesting that despite Trumpification, the US10yr treasuries have stayed largely range bound between 4.00 and 4.50
Stunned by the stupidity perhaps....or the lack of option
Storing proxy is fundamentally flawed as a strategy. Worked until it didn't. Relied on inter-currency jostling; inter-nation control; interpersonal manoeuvring - but most of all on access to that which it expects to be exchanged-for.
This event is a manifestation of the limits of the latter, seen with various degrees of clarity depending on one's pre-held desires.
'Normal' and 'back to' are not guaranteed bedfellows.
When Trump (un)subtly threatened other nations if they refused to send naval support to protect shipping through Hormuz, my first reaction was....oh shite, another wave of tariff bullying coming fast.
But after a bit of reflection, I'm seeing it in more simple terms. It is only when others grow a spine and tell the bully, firmly, cohesively, that enough is enough, that the bullying will stop - school playground stuff really.
The bully won't immediately stop and be a meak, humble, nice guy again. There will be some aftershocks. But ultimately a new equilibrium will be established.
In this current debacle, what that new equilibrium will look like is hard to predict. Perhaps it will be US and Middle East and Russian warlords battling for world domination at whatever cost to ordinary people.
I expect that the world and how it functions will be different and require each to readjust lifestyle aspirations.
I think Trump can see something that those other nations can't yet - or are unwilling to accept yet - that economically they need the oil flowing through Hormuz. If inflation keeps spiking, it may only be a matter of time before those nations agree to support Trump because economically they start hurting too much by protesting against his attack against Iran.
Its only a matter of time - weeks or months perhaps before they realise they have to change their minds.
Morals and principles (against Trumps aggression) might have to become secondary to the economic reality of what is likely to play out.
Most of Saudi's oil fields are towards their eastern coast, but they have a pipeline to their SW coast on the Red Sea. So Saudi oil can still get out. Kuwaiti and perhaps Iraqi oil are another matter. Take away the dependence on the Persian Gulf and Iran cannot hold the world to ransom anymore.
I don't know the capacity of that pipeline, but it does offer an alternative to tankers through the Hormuz Strait.
The world has been pivoting away from oil for a while now, this will help keep the momentum if not accelerate it, but oil will never be able to be fully replaced.
Houthis are like "hold my beer". They have been very quiet. Watch them unleash on the tankers in the red sea should Saudis try and bypass the Strait Of Hormuz, noting that they can only divert a fraction via their east/west pipeline. Remember the USA couldnt defeat the Houthis last time.
Albert. They didn't set out to 'defeat' the Houthis, the US operation was largely confined to containing the threat to shipping by missile interception and degradation of launch sites. The Houthis are a proxy force under Iranian control, they'll only attack tankers if Tehran says so. The same Tehran that is acting with considerable caution before attacking gulf shipping closer to home.
Considerable caution. They have attacked approx 18 ships since the start of the war. That’s not an insignificant number but remember they only need to threaten to attack for the strait to remain closed to their adversaries. Maersk CEO has said even if the insurance issue is sorted he’s not going to send their crew and assets into harms way. The houthis capabilities have not been extinguished. They signed a ceasefire deal that the USA wanted badly. Do you think Iran is going to let the Saudis reduce their leverage by allowing them to bypass the strait. When Iran says so the houthis will take down a tanker in the Red Sea and then shit will really hit the fan. Iran has trump and the west by the short and curlies and no military action will be able to change that.
Considering the number of potential targets I'd think that a comparatively modest number. It also seems either low yield drones or small boats are what has mostly been used when Iran possesses (or used to) much more powerful weapons. One would also expect catastrophic environmental damage but this doesn't seem to have occurred at scale, perhaps indicating unladen vessels are being targeted. In recent days Iran says it's now being selective on which are hit and those allowed through unmolested. All indicates to me that they are now being more careful, no doubt very mindful of their vulnerability at Kharg island. But yes, as you point out the threat is as potent as an actual hit. While the Saudis were given a bloody nose by the Houthis (read Iranians) they will be contemplating the dismantling of Iranian military capacity that's going on and could well ponder another crack. You and I view the strategic position in Iran very differently, time will tell.
Murray. And to your point those oil producers you mention will now be exercising their minds on creating permanent delivery infrastructure to bypass Hormus.
IO. Yep, correct. Pragmatism will prevail. Trump doesn't need more ships, his request for same is symbolic only.
Trump/USA is a bully that we need on our side, without him protecting us every kid in the neighbourhood will be beating us up. He's the guy we should give our school lunch to in exchange for protection. You can't trust him, but there isn't many other options.
NZ needs to go solar big time, like Aus. Banks already offer interest-free loans and the govt should chip in with subsidies. Solar panels coupled with an EV will provide households with a certain level of insulation from external energy-related shocks.
Not a complete energy self-sufficiency solution for the country, but distributed generation and 'use-at-source' would enhance NZ's energy resilience profile
The $1+ billion on LNG could instead be a $10k subsidy for solar on 100,000 homes, or a $5k subsidy on 200,000 homes. Plus a whole lot of economic benefit for all the contractors etc installing it.
Won’t do much for their 51% stake in the major power co’s though.
Dunno on that one, as my logic says it would give them an excuse to not invest in future generation which allows them to pay out more to shareholders.
What do you do about on demand supply though.
Generating power when the sun shines is the easy part.
Agree.
Add to that the Nats cancelling of the Clean Car Discount Scheme and watering down fuel efficiency standards is starting to look pretty short sighted. Anyone driving an EV right now is completely insulated from this fuel shock, (ignoring flow on effects, I know).
For interests sake, in 2023 EVs peaked at 15% of sales but are now down to 6%. EVs are still only currently 2% of the total fleet however but they'd be close to 3% if it hadn't been cancelled.
Source: EV Market Stats (2026) - Worth a look, they have very good charts on EV up take.
Anyone who can afford to buy a new EV doesn't need to steal from the less than half of households who remain net income taxpayers to help fund them.
Whether they need to or not, it was clearly encouraging people at the margins.
Not that I agreed with the policy at the time - would have preferred to see e-bikes/scooters heavily subsidised.
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