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


Deflation shows need to reform Reserve Bank mandate



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.


© Scoop Media

Parliament Headlines | Politics Headlines | Regional Headlines



Wellington.Scoop: Serco – First The Prisons, And Now It Wants To Run The Trains

As the government continues its inquiry into Serco’s discredited administration of Mt Eden prison in Auckland, here in Wellington there’s further scrutiny of the British outsourcing company – because it’s competing to take over the running of our commuter trains. More>>


Gordon Campbell: On The TPP Countdown, And Mary Margaret O’Hara

To date, the Key government has been unwilling to share any information about this TPP deal until it is too late for outraged public opinion to affect the outcome... the disclosure process is likely to consist of a similarly skewed and careful exercise in spin. More>>


Australia Deportations: English Relaxed On Immigration Centre Conditions

Labour's Annette King: “There have been numerous reports from inside these detention centres on just how bad conditions are... If they were being held in any other foreign jail, I imagine Mr English would be somewhat concerned. More>>


Schools: Achievement-Based Funding Would Be A Disaster

The Education Minister’s speech to the PPTA Conference raising the spectre of achievement data driving a new funding system would be disastrous, says NZEI Te Riu Roa. More>>

  • Video Out-Link - PPTA Annual Conference 2015 on Livestream (Q+A dicussion suggests funding would be directed to less successful schools.)

  • ALSO:

    ECE Report:

    Key In NY: Prime Minister Addresses United Nations

    Prime Minister John Key has addressed the United Nations General Assembly in New York, focusing on a call for action in Syria and on other conflicts, reform of the veto process and on the UN’s Sustainable Development Goals. More>>.


    Gordon Campbell: On The Lack Of Accountability Over Philip Smith

    In New Zealand, accountability is an exotic creature rarely glimpsed at ministerial level, or among senior management. The flight to Rio by the paedophile /murderer Philip John Smith/Traynor is no exception. More>>


    More On Corrections

    Get More From Scoop



    Search Scoop  
    Powered by Vodafone
    NZ independent news