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Recession has been averted and New Zealand has bounced back; but if you have a mortage don't get out of the brace position just yet.
Aotearoa's economy's grew 1.7 percent in the past three months - defying more pessimistic forecasts.
It's a complete turnaround on the slump experienced during an Omicron-riddled March quarter when it shrank 0.2 percent.
Opening the border has nudged growth along but anyone who's visited a supermarket lately will know that's not the only number nudging up. The cost of food and groceries grew a budget busting 8.3 percent on the same time last year.
ASB chief economist Nick Tuffley said there has been "a lot of noise and volatility" for the economy over the last few months but from now on growth would be weaker in part because of the impact of higher interest rates and a lot of cost pressures "eating into our wallets".
It was most likely that inflation had peaked but the main issue for the Reserve Bank was how much effort would be needed and how long it would take for inflation to get back to 3 percent or less. He expected it would take into 2024.
"The persistence is really key and that's what the Reserve Bank is really having to lean very hard against. Things like that tight labour market, strong wage pressures, the costs that's putting on businesses are likely to linger."
It was encouraging that petrol prices were falling and supply chain issues were easing but it was "still a challenging picture for the Reserve Bank".
Tuffley predicted moderate growth for the economy with some positive signs such as tourism picking up and the rural sector, especially dairy, "creaming it".
"It's encouraging to see this .... there's still life in the economy but we're still grappling with the challlenges of not enough people to do some of the work, so some sectors are being constrained by this and we have got those household pressures that are shifting where the growth is likely to be coming from over the next while."
For interest rates he expected the OCR to end the year at 4 percent rising to 4.25 percent early next year which would be "near the top" of what he predicted it to reach.