Cullen helps fuel interest rate rise

John Key National Party Finance Spokesman

8 December 2005

Cullen helps fuel interest rate rise

National's Finance spokesman, John Key, says Michael Cullen needs to take his share of responsibility for what is now the ninth interest rate rise in the past two years.

This morning's Monetary Policy Statement raised the Official Cash Rate to 7.25% -- the highest point since Labour came to power in 1999.

"In making the adjustment, the Reserve Bank clearly identified rampant government spending as a key contributor to inflation, and therefore to high interest rates," says Mr Key.

"This comes only a week after the OECD made the same point in their Economic Outlook.

"Homeowners, exporters, and businesses are suffering through high interest rates and high exchange rates.

"I don't see why they should shoulder the burden by themselves when there's been absolutely no belt-tightening by the Government.

"Michael Cullen needs to get control of his own wallet and stop continually blaming households for the problems of the economy."

Government spending has increased 40% since Labour come to office in 1999. At that time, the Official Cash Rate was at a low of 4.5%.

ENDS

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