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


Cut Official Cash Rate to match northern economies

Cut OCR to match northern economies

2 December 2011

The New Zealand Manufacturers and Exporters Association (NZMEA) is advocating an Official Cash Rate (OCR) cut next week in response to the problems in Europe and the USA. A cut would help to take some pressure off the currency in the short-term and add some kick to any OCR rises later on.

NZMEA Chief Executive John Walley says, “It is naïve to think that we will be insulated from the problems in Europe. While only around ten percent of our exports are sold there the impact of debt problems there will make it more difficult for New Zealand to borrow offshore.”

“The US Federal Reserve, Bank of Canada, Bank of England, Bank of Japan, European Central Bank and Swiss National Bank have agreed to lower the interest rate on US dollar liquidity swap lines by 50 basis points. Clearly other central banks are taking concerns in Europe seriously.”

“The terms of trade decline reported by Statistics New Zealand yesterday demonstrates the urgency of acting to help exporters. The more we earn offshore the better the position of NZ Inc if problems do strike. An OCR reduction would help with this.”

“A cut in the OCR now would also be likely to keep more mortgage holders on floating interest rates making OCR rises in a year or two more effective at restraining non-traded inflation.”

“We continue to promote a Reserve Bank Act that targets non-traded inflation rather than headline inflation, but an OCR cut, in line with what our trading partners are doing, would help keep pressure off the currency in the short-term.”


© Scoop Media

Business Headlines | Sci-Tech Headlines


Tax Bill Passes, Drops: “An End To Unnecessary Secondary Tax”

“The changes mean Inland Revenue will more closely monitor the tax paid by wage and salary earners through the year. If it appears the worker is being over taxed, Inland Revenue will suggest a more suitable PAYE tax code tailored to that worker.” More>>


Ethiopian Airline Crash: Boeing 737 Max Aircraft Operations Temporarily Suspended

New Zealand’s Civil Aviation Authority has suspended the operation of Boeing 737 MAX aircraft to or from New Zealand. Currently this affects only one operator, Fiji Airways. There are no other airlines that fly this aircraft type to New Zealand. More>>


Sorting Out DNA: Crime-Busting Software Wins Top Science Prize

Software developed in New Zealand that has contributed to identifying suspects in tens of thousands of criminal cases around the world has won the 2018 Prime Minister’s $500,000 Science Prize. More>>


In The High Court: IRD Wins Tax Avoidance Case

Inland Revenue has won a High Court case against Eric Watson’s Cullen Group over a nearly $52 million tax debt. More>>


Insurers Withdraw From Market: Plea For EQC Rethink

A consumer watchdog wants the government to rethink the Earthquake Commission (EQC) as more people are pushed out of getting property and contents insurance. More>>


Women's Day: New Zealand Rated Third Best In OECD For Working Women

New Zealand has been rated among the top countries in the world for working women. The Women in Work Index rated New Zealand third in the OECD and it was the only country outside Europe to make the top 10. More>>