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

 


Monetary Policy – More Focus on Employment Needed

CTU Media Release

12 September 2013

Monetary Policy – More Focus on Employment Needed

“The slow fall in unemployment anticipated by the Reserve Bank reinforces the need for wider objectives of monetary policy,” says Bill Rosenberg, CTU Economist.

“It’s forecasts still have the unemployment rate at 6.0 percent at the end of the year and above 5.0 percent out to 2016. These are well above levels we know we can achieve and they are levels we should not be happy with. The Bank commented on the state of the labour market keeping down wage rises. We would not like to think that unemployment is being accepted as an anti-inflationary tool, and one that depresses the real living standards of New Zealand wage and salary earners.”

Bill Rosenberg says “the Bank’s forecasts also see annual GDP growth peaking at 3.5 percent in June next year and then sliding back to growth rates of 2.0 percent by the end of the following year. While it was interesting to hear the Governor saying that the exchange rate was one of the factors he would take into account in deciding on future interest rate rises, he also made clear it was too high and was burning off exporters and firms competing with imports. For a better performing economy in the longer run, a clearer focus on the exchange rate is needed.”

“All of these factors point to a need to rethink the objectives of monetary policy and the tools that are used to achieve those objectives. The Productivity Commission, in its recent discussion paper on Regulatory Institutions and Practices suggested that complex decision making was more suited to a board than an individual. A broadly based Reserve Bank board with decision making power may be another important ingredient in reforming policy making in this area.”

ENDS

© Scoop Media

 
 
 
 
 
Business Headlines | Sci-Tech Headlines

 

Scoop Business: NZ Net Migration Rises To Annual Record In September

New Zealand’s annual net migration rose to a record in September, beating government forecasts, as the inflow was spurred by student arrivals from India and Kiwis returning home from Australia. More>>

ALSO:

Scoop Business: Fletcher To Close Its Christchurch Insulation Plant, Cut 29 Jobs

Fletcher Building, New Zealand’s largest listed company, will close its Christchurch insulation factory, as it consolidates its Tasman Insulations operations in a “highly competitive market”. More>>

ALSO:

Scoop Business: Novartis Adds Nine New Treatments Under Pharmac Deal

Novartis New Zealand, the local unit of the global pharmaceuticals firm, has added nine new treatments in a far-ranging agreement with government drug buying agency, Pharmac. More>>

ALSO:

Crown Accounts: English Wary On Tax Take, Could Threaten Surplus

Finance Minister Bill English is warning the tax take may come in below forecast in the current financial year, as figures released today confirm it was short by nearly $1 billion in the year to June 30 and English warned of the potential impact of slumping receipts from agricultural exports. More>>

ALSO:

Auckland Outage: Power Mostly Restored Overnight

Vector wishes to advise that all but 324 customers have been restored overnight. These customers are spread throughout the network in small pockets. The main St Johns feeder was restored around midnight allowing most of the customers in all affected areas to have power this morning. More>>

ALSO:

Half Empty: Dairy Prices Drop To Lowest Since August 2009

Dairy product prices fell to the lowest level in more than five years in the latest GlobalDairyTrade auction, led by declines in butter milk powder and whole milk powder. More>>

ALSO:

Get More From Scoop

 
 
Standards New Zealand

Standards New Zealand

Mosh Social Media
 
More RSS  RSS
 
 
 
 
 
 
 
Business
Search Scoop  
 
 
Powered by Vodafone
NZ independent news