Today’s Official Cash Rate cut is good news for borrowers, but also a symptom of rising unemployment and an economy in recession.

“Nicola Willis loves to take credit for the decisions of the Reserve Bank, which is an independent agency outside of her control, but if she wants to own the rate cuts then she needs to own what’s causing those cuts: rising unemployment and the worst recession in 30 years, excluding COVID-19,” Labour finance spokesperson Barbara Edmonds said.

“I welcome the Reserve Bank’s decision and hope that this provides some relief for Kiwis who are struggling under National’s recession, which the Bank cites as taking a sharp decline in mid-2024. The Bank’s rate cut is a direct response to the economic downturn that Luxon’s government’s decisions have caused. The economy is weak thanks to the government’s cancellation of infrastructure projects, leaving 13,000 construction workers out of a job.

“New Zealanders are expressing their frustration by leaving Aotearoa New Zealand. The latest data shows a record number of people are leaving, with 128,700 departures last year.

“If the government was serious about economic growth, it would take immediate action to stabilise the job market. That means investing in public services, infrastructure, and climate initiatives that create jobs, not axing funding for schools, hospitals, and public housing. It’s time for leadership that invests in jobs, skills, and the future, not cuts and excuses,” Barbara Edmonds said.

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