29 July 2004

Interest Rates Too High Says Peters

Rt Hon Winston Peters says the Reserve Bank is going to strangle the economy by continually raising interest rates.

The bank has just increased benchmark interest rates from 5.75 percent to 6 percent, which is the highest bank rate in the developed world.

“The bank is now starting to follow the trend started by Don Brash when he was governor and that is, if the economy is starting to lift, choke it!”

Mr Peters said the bank’s claim today that the Official Cash Rate increase reflected a continued buoyant economy was hard for most people to accept as a lot of the economic rewards were going offshore.

“This latest hike will make it even harder for exporters, businesspeople and young New Zealanders trying to buy a home.

“The governor’s renewed warning of further interest rate rises shows that the bank will keep its feet planted firmly on the throat of the New Zealand economy.

“It bodes ill for ordinary people that the experts have learned nothing in the past 15 years,” said Mr Peters.

ENDS

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