For six months now governor Alan Bollard has been asking the household sector nicely to go easy on the borrowing and spending at least until the productive side of the economy could catch up. People have taken no notice.
So thismorning he has raised the official cash rate by a quarter of a percentage point to 7.5 per cent and warned that further tightening of the screws may be required.
The warning is crucial. He has to persuade people he will keep on raising interest rates until he sees the "moderating trend in housing and domestic demand" he regards as essential if inflation is to remain under control.
The monetary policy statement accompanying the interest rate decision is dark with menace.
The Reserve Bank sees inflation pressure at every turn - in a buoyant housing market, in a very tight labour market, in the government's expansionary fiscal policy and in the banks' willingness to lend at very low margins.
It's very much a fire and reload statement. Adding to the scary tone of the announcement the bank is openly considering a need for supplementary measures to rein in the housing market, including tightening the tax rules on housing investment and changing the rules on how much capital banks need to hold to cover their housing loans.
But putting "housing" and "tax" in the same sentence tends to send politicians running for the hills.
