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Other ways to deal with inflation

Other ways to deal with inflation

Business NZ has written to the Minister of Finance suggesting alternatives to higher interest rates.

Business NZ Chief Executive Phil O’Reilly says there’s widespread business concern about over-reliance on interest rates to curb inflation in the housing market.

“Ratcheting up interest rates will harm the productive sector, especially exporters,” he said.

“Our members are also concerned at the prospect of direct Government restrictions on the housing market.

“The request for the Reserve Bank to come up with a report next month on a ‘supplementary stabilisation project’ could mean restrictions on home mortgages, to dampen down the overheated property market.

“Our members are very concerned that this could adversely affect the ability of small businesses to expand by borrowing against their homes.

“We are suggesting five actions the Government could instead take that would help curb inflation in the medium term and that would immediately assist in increasing business confidence.”

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