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Michael Cullen caught out telling two stories

John Key MP National Party Finance Spokesman

06 October 2004

Michael Cullen caught out telling two stories

"Michael Cullen should be more up-front about interest rates with Kiwi mortgage holders, after being caught out telling one story to the Americans and another here at home," says National's Finance spokesman John Key.

Mr Key is referring to statements made by Dr Cullen about the state of the New Zealand economy while briefing high-powered Dow Jones analysts.

"Dr Cullen has warned of at least three more interest rate hikes in the near future, something that Deutsche Bank commentators say goes a lot further than Reserve Bank projections.

"Dr Cullen has essentially told an overseas audience that floating interest rates could rise as high as 9%, assuming the lift was only one quarter of a per cent each time.

"Dr Cullen appears to be in breach of the convention which suggests the Finance Minister should not comment on such things, and it comes only weeks after he pre-announced the recent Reserve Bank interest rate rise.

"I would have thought Dr Cullen owed it to New Zealand mortgage holders to give them the bad news before he gave it to the American analysts.

"In the same briefing, Dr Cullen has also confirmed the National Party's fears that Labour is preparing an unrivalled war chest for a good old-fashioned election-year spend-up.

"He's been reported as saying Labour had been banking the surpluses to spend on the downward cycle.

"That's code for a state-sponsored giveaway, timed conveniently around the election. It also makes a mockery of his repeated claims that the whole surplus has been committed and there is no room to refund overtaxed New Zealanders," says Mr Key.

"Which story is true, Dr Cullen? The story you're giving the Americans or the story you're feeding us?"


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