Media Statement

For immediate release

Wednesday, 3 September, 2003

Copeland urges interest rate cut

United Future finance spokesman Gordon Copeland today called on Reserve Bank Governor Alan Bollard to further cut interest rates in tomorrow's monetary policy statement.

"Inflation projections at around 1 percent are alright, but economic growth looks set to halve at around 2.2 percent, as against 4.4 percent last year.

"However, more worrying is the New Zealand Institute of Economic Research projection of just 2 percent growth until mid-2005, and in that kind of scenario, further easing of monetary conditions would help.

"It should be remembered that although the official cash rate of 5.25 percent is low by New Zealand standards, it is currently the highest in the OECD - way above the rates in Europe, the United States and Australia.

"With inflation under control this is a chance for Mr Bollard to give the economy some gentle stimulation," Mr Copeland said.

Ends.

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