Gordon Campbell | Parliament TV | Parliament Today | News Video | Crime | Employers | Housing | Immigration | Legal | Local Govt. | Maori | Welfare | Unions | Youth | Search

 


Reasons for interest rate rise not convincing

Reasons for interest rate rise not convincing

“The Reserve Bank has not given a convincing case that general inflation is a big enough risk to raise interest rates”, says CTU Economist Bill Rosenberg. “In fact it seems to be pushing against higher wages. It is also forecasting unemployment will not fall below 5% - in current terms over 120,000 people. It appears that continuing wage stagnation and permanently high unemployment are the price we pay for these policies.”

Rosenberg, commenting on the media conference after the Reserve Bank announced its interest rate rise, noted that when pushed to describe what the inflationary pressures were, the Reserve Bank could name only construction costs and government charges – but said that “general demand pressures” would lead to general price rises and growing wages. It appears to see wage rises as something to be resisted rather than welcomed after years of wage stagnation.

Its forecasts of unemployment see the unemployment rate bottoming out at 4.9-5.0 percent in December 2014 and not falling any further in the forecast period out to the end of 2016. “These are not levels of unemployment most New Zealanders would find acceptable as a permanent state of affairs, particularly alongside stagnating wages and rising housing costs”, Rosenberg says.

“What is the problem these policies are trying to address? Is it bad to have lower unemployment and rising living standards? Should we be choking off house building when rising house prices are a risk? There is surely no suggestion we want to slow the Canterbury rebuild because of its inflationary potential. We should address the causes of rapid price increases in specific areas like housing and energy prices rather than general interest rises that hurt the rest of the economy,” Rosenberg concluded.

ENDS

© Scoop Media

 
 
 
 
 
Parliament Headlines | Politics Headlines | Regional Headlines

Pre-Caucus Audio:
David Cunliffe And
The Future Of The
Labour Party

David Cunliffe met with the press today after Saturday’s disappointing election result for The Labour Party.

“We are all deeply concerned by the result of our party vote. I want to be clear that I, as leader, am responsible for that result” Cunliffe said. Although he called the results “deeply disappointing” Cunliffe said “the voters are always right”.

He felt that Labour needed to make improvements and take action: “We don’t need months to get feedback from members of the public, we've had a lot over the past 48 hours”. More>>

 

Gordon Campbell: On Labour’s Very Bad Year

While Labour leader David Cunliffe still appears to be in denial about the extent of Saturday night’s debacle, there was hardly a single redeeming feature about the election results for the centre-left... More>>

ALSO:

General Election NZ: National Win

Election Night: With almost all votes counted National and John Key have won a third term and are close to being able to govern alone if they so choose. Key has indicated he will still reach out to form a Government with ACT, United Future and Maori Party. More>>

ALSO:

Perfectly-Timed Anniversaries: Suffrage Day Is Last Chance To Enrol

“The last chance to enrol is Friday 19 September. You can’t enrol on election day.” More>>

ALSO:

Gordon Campbell: On First Time Voting (Greens)

For the last two days, I’ve turned my column over to a couple of guest columnists who are first time voters… Today’s guest columnist is Ana Avia-O’Connor, who will be casting her first time vote on Saturday for the Greens. More>>

ALSO:

Meddling: Aussie Liberals Embroiled In Key Campaign

John Key needs to explain why Australia’s Liberal Party is interfering in New Zealand domestic politics and is encouraging Kiwi voters across the ditch to vote for National just days out from the election, Labour’s campaign spokesperson Annette King says. More>>

ALSO:

SURVEILLANCE:

Election Ad Soundtrack: Rapper Eminem Sues National Party Over Copyright Breach

US rapper Eminem is suing the New Zealand National Party for alleged copyright infringement over unauthorised use of the rapper’s ‘Lose Yourself’ song in an election campaign advertisement. More>>

ALSO:

Big March: Call For An End To Domestic Violence

Hundreds of protesters marched down Lambton Quay to Parliament Monday calling for an end to domestic violence. Wearing white facemasks, waving banners and calling for “safety” for the women and children of New Zealand.. More>>

ALSO:

Pre-Election Chartering: Four New Partnership Schools To Open

Education Minister Hekia Parata today announced the Government has signed contracts to open four new Partnership Schools in 2015. More>>

ALSO:

Werewolf 50 Out Now - The Election Issue: Loss Leaders

Gordon Campbell: A third term requires a mature decision, with eyes wide open. It calls for a conscious vote of confidence… Without trying hard here are about 19 reasons, in no particular order, for not ticking ‘party vote’ National. More>>

ALSO:

Get More From Scoop

 

LATEST HEADLINES

 
 
 
 
 
 
 
 
Politics
Search Scoop  
 
 
Powered by Vodafone
NZ independent news