Economists expect we'll see the ugliest inflation number in more than 30 years when StatsNZ releases its first-quarter Consumer Price Index data at 10.45am this morning.
"March quarter inflation result is set to be another monster," said Westpac senior economist Satish Ranchhod.
"Price pressures are bubbling over in every corner of the New Zealand economy, boosted by a potent cocktail of supply-side cost pressures, including rising wages, and firm consumer demand."
Westpac is picking CPI inflation will land at 1.9 per cent for the quarter, taking the annual inflation rate to 7 per cent. That's up from 5.9 per cent annual inflation for the 2021 year.
That would make the highest inflation rate New Zealand has seen since a GST-related spike in 1990.
Other economists think it could be worse.
ASB economists see it landing at a 2.2 per cent quarterly increase - taking annual headline inflation to 7.3 per cent.
ANZ has tipped it to hit 7.4 per cent.
But ANZ economist Finn Robinson warns uncertainty is high in the wake of Omicron disruption and the commodity price volatility resulting from the Russian invasion of Ukraine.
The quarter to March 31 will include the big spike in oil prices in the wake of the invasion.
That has ANZ forecasting that given that tradeable (ie imported) inflation could top 8.9 per cent.
"Given we saw the Omicron wave peak, and global commodity prices surge in the wake of the Russian invasion, it's very possible that tradables inflation comes in even hotter than the 8.9 per cent, year on year, we've pencilled in," said Robinson.
But there are worrying signs that high inflation is now being generated by domestic (non-tradeable) parts of the economy.
ANZ sees non-tradeable inflation hitting 6.5 per cent.
"Rising inflation expectations and an extremely tight Kiwi labour market create their own feedback loop of rising prices – supported by the very strong starting point for domestic inflation pressures," Robinson said.
"That speaks to the RBNZ needing to hike interest rates aggressively over this year to get ahead of the inflation curve. At this point, inflation is rising considerably faster than the OCR is."
Last week the RBNZ delivered a 50 basis point rate hike, taking the Official Cash Rate to 1.5 per cent.
ANZ forecasts it will need to deliver another 50 basis point hike in May.
What's not clear is whether the March quarter will represent the peak of the inflation cycle.
Around the world inflation has spiked in the past year. The US last week saw its rate of inflation hit 8.5 for the year to March 31. In the UK it is 7 per cent.
"The inflation horse has bolted," said ASB senior economist Mark Smith.
"The bigger issue to us is not so much what the inflation peak will be, but how persistent the uptick in inflation is."
While ASB expects we may be at, or close to, the peak in annual inflation they see it staying elevated through the year.
"Our CPI profile is higher and more protracted than the [RBNZ] February MPS forecasts," he said.
"With annual CPI inflation ending 2022 at above 6 per cent, and not moving under 3 per cent until mid-2024.
"Price rises are expected to be more broad-based and there is the risk of high inflation being more entrenched."
That risk had Smith also tipping another 50bps hike from the RBNZ in May.
The RBNZ's last published forecast in February anticipated an inflation rate of 1.4 per cent for the quarter.
But that was made before the Ukraine invasion and subsequent oil shock, said Westpac's Ranchhod.
"It's likely that the RBNZ will be braced for a higher result on the day. Consequently, a result in line with our forecast isn't likely to prompt a change in the RBNZ's policy
stance," he said.
"Indeed, the RBNZ has already become increasingly hawkish in recent months."
Westpac is forecasting a series of OCR hikes over the coming year, with the cash rate expected to peak at 3 per cent.