For immediate release
Friday 23rd May 2008
Banks Should Lower Interest Rates - Now!
Finsec, the bank workers union called on the banks to reduce interest rates - today, saying some of their record profits can be redistributed to assist workers and the New Zealand economy.
The call comes in response to the possible impact on inflation of tax cuts announced in yesterday’s budget. “Profits of the major banks we deal with for the six months to the March 2008 quarter increased an average of 11.3% over the same period last year. It is very clear the banks can afford to cut interest rates today and make a real difference for both their customers who are dealing with ever increasing costs of living and for the New Zealand economy in weathering an international global economic slow down,” said Andrew Campbell, Finsec’s Campaigns Director.
“Recent commentary that the link between retail interest rates and the OCR has changed from its’ previous pattern is correct and we see no reason why the banks should wait for the Reserve Bank to lower the official cash rate (OCR) before reducing their interest rates again,” said Campbell.
“A reduction in interest rates plus tax cuts would give the economy a real shot in the arm. Such a move would arguably be no more inflationary than the ‘north of $50 per week’ tax cuts John Key and the National Party promised,” Campbell said. we call on them to do so - today,” he said.