Video | Agriculture | Confidence | Economy | Energy | Employment | Finance | Media | Property | RBNZ | Science | SOEs | Tax | Technology | Telecoms | Tourism | Transport | Search

 

Reserve Bank Gets It Right

The Reserve Bank's decision to wait and see before raising interest rates is the right one for business, according to the Employers & Manufacturers Association (Northern).

"That aspect of inflation generated by demand that the Reserve Bank controls is not going anywhere, so Dr Brash's decision not to lift interest rates is the best approach," said EMA's chief executive, Alasdair Thompson.

"There is still a risk that the expectations of high pay settlements set off by Government policies will feed into second round inflationary effects.

"Dr Brash will have factored that possibility into the Bank's forecasts over the next year or so, though it is too early for these particular chickens to be home roosting.

"The Bank is giving us the benefit of large doubt, with an opportunity to grow the economy before bickering over who should be getting the biggest slice of it.

"In the meantime there's time for second thoughts; big and wide spread pay demands will ensure the economic pie does not grow, with a loss of jobs, bankruptcies and more debt.

"If we can take advantage of this window of restraint, higher interest rates further down the track may be staved off."

Ends

© Scoop Media

 
 
 
Business Headlines | Sci-Tech Headlines

 

"Broad-Based Growth": GDP Rises 1 Percent In June Quarter

Gross domestic product (GDP) rose 1.0 percent in the June 2018 quarter, up from 0.5 percent last quarter, Stats NZ said today. This is the largest quarterly rise in two years. More>>

ALSO:

Judicial Review: China Steel Tarrif Rethink Ordered

On 5 July 2017 the Minister determined not to impose duties on Chinese galvanised steel coil imports. NZ Steel applied for judicial review of the Minister’s decision. More>>

Debt: NZ Banks Accelerate Lending In June Quarter

New Zealand's nine major lenders boosted lending at the fastest quarterly pace in almost two years as fears over bad debts subsided. More>>

ALSO:

Balance Of Trade: Annual Current Account Deficit Widens To $9.5 Billion

New Zealand’s current account deficit for the year ended June 2018 widened to $9.5 billion, 3.3 percent of GDP, Stats NZ said today. More>>

ALSO: