Gordon Campbell | Parliament TV | Parliament Today | Video | Questions Of the Day | Search

 


Deflation shows need to reform Reserve Bank mandate

David

PARKER

Spokesperson for Finance

18 January 2013 MEDIA STATEMENT
Deflation shows need to reform Reserve Bank’s tunnel vision mandate

Prices dropped in the last three months of the year while the housing market took off and the dollar remained stubbornly high, showing the need for monetary policy reform, says Labour’s Finance spokesperson David Parker.

“Deflation in the last quarter shows inflation is no longer the main problem. The high exchange rate that is crippling exporters and costing jobs is.

“Meanwhile the housing market is taking off again, meaning the Reserve Bank is likely to keep interest rates high compared to other countries, which keeps the dollar high.

“Our monetary policy has passed its use-by date. The Reserve Bank has a tunnel vision mandate that requires it to primarily consider the prospect of increasing inflation. This pushes other big issues - our overvalued and damaging exchange rate – down the priority queue

“This is despite unemployment at 13-year highs, a stagnating economy and a $10 billion external deficit, which is worse than every developed country bar Greece.

“National’s economy isn’t working for ordinary New Zealanders. Manufacturing outside primary industries is in trouble and jobs are being cut every week. It’s the high dollar that’s causing this, not inflation. We need to remove the tunnel vision mandate and give the Reserve Bank a 20/20 perspective for the economy.

“Labour has long argued that the Reserve Bank must be able to look beyond inflation and give equal weight to other important issues such as the exchange rate and jobs. That would help our exporters and manufacturers and allow them to create good jobs that pay a decent wage,” says David Parker.

ENDS


© Scoop Media

 
 
 
 
 
Parliament Headlines | Politics Headlines | Regional Headlines

 

Gordon Campbell: On The IOC’s Treatment Of Russian Sport, And Lone Wolf Terrorism

A blanket ban on Russian athletes would also have exposed the IOC to criticism that its treatment of Russia would have been marked contrast to its treatment say, of the track and field team from Kenya – a country about which the IOC has very similar doping concerns. More>>

ALSO:

Sounds Like A Plan: Auckland Council Receives Unitary Plan Recommendations

A key milestone in New Zealand planning history was reached today when the Independent Hearings Panel delivered the reports containing its recommendations on the Proposed Auckland Unitary Plan. More>>

ALSO:

National Park Expansion: Forests And Coast Of Kahurangi Protected

Five parcels of high value land totalling more than 890 hectares have been formally gazetted as part of the National Park. More>>

ALSO:

PPP Go-Ahead: SkyPath Gets Unanimous Support

Auckland’s SkyPath project has been given the go-ahead to be delivered through a public private partnership, after a unanimous decision at today’s Finance and Performance Committee. More>>

ALSO:

Gordon Campbell: On The Reserve Bank, The UN Shortlist, And Trump

Can there really be there any link between the US presidential elections and yesterday’s RBNZ signals on interest rates and the NZ dollar? Well, maybe. And it would be this: the improving US economy is reportedly putting a tailwind behind the US dollar, and rendering the actions of our Reserve Bank virtually irrelevant. More>>

ALSO:

Gordon Campbell: On What John Key Should Be Asking Joe Biden

No doubt, US Vice-President Joe Biden will be updating Prime Minister John Key on the chances of a TPP vote taking place in the ‘ lame duck’ session of Congress that’s held between the November’s election and the inauguration of a new President in January. More>>

ALSO:

Make NZ Make Again: Greens Will Establish A Minister For Manufacturing

The Green Party announced today that it will establish a Minister for Manufacturing in Cabinet, to better represent the interests of manufacturers and ensure they thrive. The Minister will be inside Cabinet and have responsibility for the long-term interests of the manufacturing sector. More>>

ALSO:

Get More From Scoop

 

LATEST HEADLINES

 
 
 
 
 
 
 
 
 
Parliament
Search Scoop  
 
 
Powered by Vodafone
NZ independent news